Rand firms as in­vestors seek higher re­turn

Weekend Argus (Saturday Edition) - - LIFE -

THE rand climbed to its strong­est in nearly a week against the dol­lar, boosted by a search for higher yield as in­vestors bet that interest rates would stay de­pressed in lead­ing economies.

Stocks put in mod­est gains in line with global peers, with the bench­mark Top 40 in­dex adding 0.26 per­cent to 44 920. while the wider All-share in­dex ended 0.35 per­cent higher at 51 276. The rand took in its stride a warn­ing from Moody’s that South Africa was the most ex­posed in the sub-Sa­ha­ran Africa re­gion to mar­ket volatil­ity linked to Bri­tain’s de­ci­sion to leave the EU.

By 1545 GMT, the rand was trad­ing 1.3 per­cent firmer at 14.5850 per dol­lar from an overnight close of 14.7800 in New York.

This was in spite of stronger- thanex­pected non-farm pay­rolls num­bers out of the US, which how­ever left in­vestors still un­con­vinced that the Fed­eral Re­serve would raise interest rates this year.

“Global mar­kets still don’t be­lieve that the US is ac­tu­ally go­ing to hike any­thing this year, so it’s still go­ing to be very much a low­in­ter­est en­vi­ron­ment glob­ally,” Trea­sury One dealer Phillip Pearce said.

SAdebt also ended the day higher as a re­sult, with the yield for the 2026 bench­mark shed­ding six ba­sis points to 8.71 per­cent. – Reuters

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