ANL 34.32 Decreased By ▼ -0.20 (-0.58%)
ASC 14.85 Decreased By ▼ -0.31 (-2.04%)
ASL 24.50 Decreased By ▼ -0.33 (-1.33%)
AVN 90.24 Decreased By ▼ -4.76 (-5.01%)
BOP 7.79 Decreased By ▼ -0.08 (-1.02%)
BYCO 10.05 Decreased By ▼ -0.26 (-2.52%)
DGKC 124.20 Decreased By ▼ -2.40 (-1.9%)
EPCL 56.30 Decreased By ▼ -0.86 (-1.5%)
FCCL 24.31 Decreased By ▼ -0.19 (-0.78%)
FFBL 27.60 Decreased By ▼ -0.36 (-1.29%)
FFL 16.05 Increased By ▲ 0.01 (0.06%)
HASCOL 9.74 Decreased By ▼ -0.28 (-2.79%)
HUBC 80.00 No Change ▼ 0.00 (0%)
HUMNL 6.44 Decreased By ▼ -0.01 (-0.16%)
JSCL 20.50 Increased By ▲ 0.09 (0.44%)
KAPCO 40.21 Decreased By ▼ -0.73 (-1.78%)
KEL 3.85 Decreased By ▼ -0.02 (-0.52%)
LOTCHEM 16.25 Decreased By ▼ -0.99 (-5.74%)
MLCF 46.60 Decreased By ▼ -0.31 (-0.66%)
PAEL 35.10 Decreased By ▼ -1.07 (-2.96%)
PIBTL 10.33 Decreased By ▼ -0.16 (-1.53%)
POWER 9.25 Decreased By ▼ -0.10 (-1.07%)
PPL 85.50 Decreased By ▼ -0.24 (-0.28%)
PRL 25.01 Decreased By ▼ -0.70 (-2.72%)
PTC 9.55 Increased By ▲ 0.10 (1.06%)
SILK 1.24 Increased By ▲ 0.07 (5.98%)
SNGP 38.82 Decreased By ▼ -0.54 (-1.37%)
TRG 167.40 Increased By ▲ 7.79 (4.88%)
UNITY 30.65 Decreased By ▼ -0.10 (-0.33%)
WTL 1.53 Increased By ▲ 0.10 (6.99%)
BR100 4,820 Decreased By ▼ -31.91 (-0.66%)
BR30 25,669 Decreased By ▼ -2.82 (-0.01%)
KSE100 44,978 Decreased By ▼ -208.43 (-0.46%)
KSE30 18,443 Decreased By ▼ -42.02 (-0.23%)

Coronavirus
VERY HIGH
Pakistan Deaths
15,501
5824hr
Pakistan Cases
725,602
458424hr
Sindh
269,126
Punjab
250,459
Balochistan
20,321
Islamabad
66,380
KPK
99,595
Markets

South Africa's rand to stay on backfoot, bonds weaken

JOHANNESBURG: South Africa's rand steadied against the dollar on Tuesday with the market wary of taking on risky asset
13 Dec 2011

south_africaJOHANNESBURG: South Africa's rand steadied against the dollar on Tuesday with the market wary of taking on risky assets due to fears of possible sovereign ratings downgrades in the euro zone.

The rand fell sharply in the previous session as investors were disappointed by a lack of concrete action from euro zone leaders to end the debt crisis after a summit last week.

Rating agencies warned the summit, viewed by some as a last chance to save the euro, did not go far enough in easing immediate concerns about the region's debt markets.

Domestically, the debt market was weaker in line with the currency ahead of a weekly auction - the last for the year. Results will be out after 0900 GMT.

Domestic stocks looked set for a negative opening as global markets were in the red. The JSE's Top-40 December futures contract was slightly down before the start of trade at 0700 GMT.

The rand was trading at 8.28 against the dollar at 0644 GMT, not far from Monday's New York close of 8.27.

"Technically, levels towards or just above 8.30 become important. A break above might see another leg higher to 8.460," said Tradition Analytics in a note.

"Failure to break higher might entice some export dollars back into the market."

Despite recovering from a 2-1/2 year low of 8.61 seen in November, the rand has maintained a weaker tone, trying and failing several times in early December to break firmer than 8.00 to the dollar.

On fixed income, the yield on the 2015 government bond was up 5.5 basis points to 6.91 percent and that on the 2026 note climbed six basis points to 8.645 percent.

On the data front, the Bureau of Economic Research will release inflation expectations later in the session while Statistics South Africa will release formal employment numbers.

Bonds may see further selling should the inflation expectations survey show a broad-based rise, Tradition said.

Wednesday's data is expected to show annual CPI inflation breached the central bank's 3-6 percent target in November and rose to 6.2 percent. The Reserve Bank sees inflation to staying outside the target band for most of next year.

The weaker rand - which has lost 24.5 percent against the dollar this year - is also an upside risk to inflation, the central bank has said.

Copyright Reuters, 2011