JOHANNESBURG: South Africa's rand was steady in early Tuesday trade, stuck in a wide range set on Friday, with little in the way of market events to push the currency in a firm direction until later this week.
Central bank reserves data, which came in slightly higher and overshot market expectations for July, failed to move the rand out of the range.
Stock of gold and foreign exchange reserves inched up by $39 million in July to $47.975 billion, while gross reserved rose by $180 million to $49.398 in the month.
The forward position - the banks unsettled spot or swap transactions - fell to $6.092 from $6.221 billion in June.
The rand shrugged off the positive data, sticking to its closing 8.17/dollar level by 0615 GMT. The local unit needs to break out of Friday's range between 8.12 and 8.38 to open up new levels, analysts said.
In the session 8.15 will provide a barrier and a break out from 8.12 will open up resistance around 8.11.
"Importers as of yesterday found levels towards 8.1500 a little more attractive and that is expected to be the case again today," said research house Tradition Analytics.
"As a result, the strategy remains to look for a 8.13/2500 range to hold through the day, with a slight preference to buying dollars towards or below 8.1500."
Yields on government debt nudged higher ahead of a weekly bond auction. Treasury has offered 2.1 billion rand ($257.72 million) spread between its 2023, 2041 and 2048 issues. Results are due after auction closes at 0900 GMT.
The benchmarks rose 1.5 basis points each to 5.485 percent on the 2015 and 7.3 percent on the 2026 bond.
Later in the session the market will look to a business sentiment survey at 0930 GMT to get clues on where the economy may be headed according to the level of confidence in the economy shown by local managers.
Manufacturing data on Wednesday may shake the rand out of its lull, where economists polled by Reuters expect the production index to have eased to 3.2 percent in June from 4.2 percent in May.
Comments
Comments are closed for this article.