JOHANNESBURG: South Africa’s rand rand firmed by one percent against to the dollar after the greenback weakened for a second straight session, while stocks firmed across the board tracking the stronger rand.
Comments by the US Federal Reserve Chairman Jerome Powell on Friday suggested a slower pace of monetary tightening, putting pressure on the dollar.
At 1540 GMT, the rand traded 1.2 percent firmer at 14.1200 per dollar.
“It’s mainly due to the slide in the dollar. I don’t believe it’s any local factors,” said Treasury One dealer Andre Botha.
Fed chief Jerome Powell said on Friday the US central bank was sticking with its strategy of gradual rate hikes to protect economic growth.
“It’s a better time for emerging markets,” said Afrifocus Securities derivatives trader Cheslyn Francis.
He said Emerging Markets have attracted inflows despite the ongoing trade war between the US and China.
In fixed income, the yield on the benchmark government bond due in 2026 was down 3 basis point to 8.87 percent.
On the bourse, the Johannesburg All-share index closed 1.46 percent stronger at 59,656 points. The blue-chip top 40 index rose 1.54 percent to 53,555 points.
Bullion producer Harmony Gold rose 3.84 percent to 23.52 rand, followed by diversified miner Sibanye-Stillwater closed 3.98 percent up to 8.36 rand as the spot price of the precious metal recovered.
Gold prices slid in the previous session when Powell reiterated the central bank’s intention to raise rates gradually.
Source: Brecorder
