Rand firmer, gaining 2% while bonds weaker
THE RAND ended a tough week on a firmer footing against the dollar yesterday, gaining 2 percent within a seven- day range as it follows the euro’s course, while government bonds corrected and yields rose on the benchmarks.
In a show of its volatility and thin market conditions, the rand traded in a wide 7.95 to 8.32 range this week, pulled in different directions by developments in the debtplagued euro zone. It firmed as much as 8.0965 against the dollar yesterday.
Government bonds were weaker with the yield on the four-year benchmark adding five basis points to 6.77 percent while the 15-year bond rose six basis points to close at 8.49 percent. Yields on the benchmark bonds were at three-week lows last week.
“Bonds are tracking what’s happening in Europe and we had a terrible week on the rand. The weakness is mainly to do with the story of the ECB easing,” a trader said.
Treasury bills maturing in 91 days were under-subscribed yesterday for the first time since December 2009 as the global markets’ rout sees investors close their books earlier than usual and leave markets thin. – Reuters