RAND FLAT, STOCKS HIGHER
THE RAND was mostly flat yesterday, with investors weighing conflicting signals from the US Federal Reserve that pushed the dollar away from twomonth highs.
At 5.07pm, the rand traded at R14.24 against the dollar, down just 0.07 percent from its previous close.
Global investors were left waiting for upcoming US economic data for direction after conflicting signals on the timing of withdrawal of monetary stimulus in the country, with the dollar also vacillating yesterday.
“For now, we can expect the rand to mostly track the dollar,” Andre Cilliers, a currency strategist at TreasuryONE, said.
The greenback got some support overnight as two Fed officials said a period of high inflation in the US could last longer than anticipated, a day after Fed chairman Jerome Powell had played down rising price pressures.
But it slipped yesterday, paring back gains after hitting a two-month high last week.
Local investors also got further clues about inflationary pressures in South Africa, after StatsSA also published data showing that producer price inflation rose to 7.4 percent year-on-year in May, from 6.7 percent in April.
Data on Wednesday showed consumer inflation hit a 30-month high in May, but economists are not predicting the SA Reserve Bank will raise interest rates any time soon.
South African government bonds were also strengthened slightly, with the yield on the benchmark 2030 instrument dipping 6 basis points to 8.89 percent.
Stocks were up, with the JSE bluechip Top40 index closing 0.71 percent higher at 60 118.42 points and the broader all share index up 0.67 percent at 66 263.49 points.
Old Mutual was the biggest winner on the blue-chip index, up more than 8 percent after it announced it would further cut its stake in lender Nedbank. It closed 6.12 percent up.