JOHANNESBURG: South Africa's rand opened slightly firmer against the dollar on Wednesday but looked ripe for a test of the 8.30 support barrier in the trading day.
The rand nudged up just 0.12 percent to 8.2540 to the dollar at 0640 GMT, off a 8.2675 close in the New York session on Tuesday.
The currency had looked set to test 8.15 and then 8.11 resistance levels in the last two sessions.
However, the unit pulled back to just below 8.30 overnight on dollar demand from New York investors trying to cover against risky positions ahead of a European Central Bank policy meeting on Thursday.
"We didn't manage to break the 8.305 (dollar) resistance area in New York trading, and above there, the 8.370 level should offer further resistance," said Warrick Butler, a rand trader at Standard Bank.
The rand has hit a low of 8.29 so far on Wednesday, making a break of 8.30 within reach.
Investors will also be watching for the Federal Reserve's monetary policy statement later in the session. The market is expecting further easing to prop up the slowing US economy.
If the Fed disappoints on the expectation, the rand is likely to head for 8.50 to the dollar.
Locally, the July Purchasing Managers' Index, a survey that gives clues about manufacturing activity, is due at 0900 GMT.
The sector contributes 15 percent to GDP. Jobless statistics on Tuesday showed manufacturing had shed 44,000 jobs in the second quarter, dampening hopes of a recovery in a sector that has been hard hit by the euro zone debt crisis and a slowing Chinese economy.
Yields on government debt each nudged 1.5 basis points higher to 5.525 percent on the three-year paper and 7.36 percent on the 14-year issue.
Treasury will announce issuance plans for Tuesday's weekly auction at 0900 GMT.
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