Chinese credit report gives rand a boost

The rand advanced to its strongest level in more than three weeks against the dollar yesterday after China said new credit hit a record high last month, signalling the country would maintain its growth momentum. The rand has rebounded 4.3 percent since the Reserve Bank unexpectedly increased borrowing costs on January 29, as governor Gill Marcus said inflation was set to breach the 6 percent ceiling of its target range towards the middle of the year. A report tomorrow is expected to show inflation accelerated for a second month in January. “Commodity prices and commodity currencies should receive some support” after the Chinese lending report eased concerns that the economy was heading for a slowdown, Bruce Donald, a currency strategist at Standard Bank, said.

Stocks rose on Friday, sending the Standard & Poor’s 500 index (S&P 500) to within 10 points of its record closing high, amid better-than-forecast earnings. The market was closed yesterday.

The S&P 500 rose 0.5 percent to 1 838.63 and the Dow Jones industrial average added 0.8 percent to 16 154.39.

Occidental Petroleum gained 3.8 percent after the largest oil producer in the continental US said it would split its operations in California as one of the final steps of a break-up plan. Campbell Soup added 5 percent as earnings beat forecasts.

On the recent release of economic data, Bruce Bittles, the chief investment strategist at RW Baird in Florida, said: “The weather is so horrible everywhere, much of the data could be very distorted. The Federal Reserve is going to wait until the weather clears and until we get some more numbers in March and April to consider the data. The picture will start to clear on how great or how poor the economy is.” – Bloomberg