Rand benefits from improved sentiment

SA’s rand gained 1% against the dollar on Friday as improved global risk appetite offset investors' worries about the domestic economic climate.

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Johannesburg - South Africa's rand gained 1 percent against the dollar on Friday, as improved global risk appetite offset investors' worries about the domestic uncertain political and economic climate.

By 07h48 GMT the rand had gained 1 percent to 15.1355 per dollar in a rally that kicked-off in offshore trade, where the unit strengthened as high as 15.1420.

“Its been very choppy trading. The rand is moving in the ranges and we've seen a bit of improvement in sentiment in emerging markets. But there's not a lot of liquidity which is why we are seeing these large moves,” chief dealer at Bidvest Bank said Ion de Vleeschauwer.

The rand has struggled to hold on to gains below the 15.2000 technical resistance point, but looked set to end the week below the mark as traders held off bets with a dearth of domestic and offshore data in the session.

“There has been a little bit of tick back with some traders squaring up before the weekend. It looks like there is some support for the rand in higher 15.20's,” de Vleeschauwer said.

The rand failed to gain any traction from positive business confidence and manufacturing data in the previous session, with worries over political tension weighing on sentiment, but gradually gained momentum in overnight trade.

Bonds were flat in early trade, with the benchmark government issue due in 2026 unmoved at 9.275 percent.

Stocks were higher in early trade, with the JSE's Top-40 index rising 0.48 percent to 45,239 points.

REUTERS