RAND, GOLD UP, DOLLAR DOWN

THE RAND posted strong gains yesterday as the dollar retreated, gold prices rallied and local bonds advanced.

At 5.30pm, the rand traded at R14.82 against the greenback, around 1 percent firmer than its previous close.

The dollar struck a one-year high on Tuesday on rising expectations that the US Federal Reserve would announce a tapering of its stimulus next month, but it fell over 0.3 percent against a basket of currencies yesterday.

That helped lift prices of precious metals like gold and platinum, key South African exports, before minutes of the Fed’s latest policy meeting were due to be released later in the session.

A decline in US Treasury yields supported appetite for South Africa’s local government debt, with the yield on the benchmark 2030 bond falling 16 basis points to 9.38 percent.

Markets shrugged off disappointing domestic retail data that showed sales declined 1.3 percent year on year in August, whereas economists had forecast a rise of 2.6 percent.

Stocks were flat, with the JSE bluechip Top40 index rising 0.03 percent to 59 516.75 points and the broader all share index rising 0.04 percent to 66 012.78 points.

Precious metals miners were among the best performers of the day.

Anglo American Platinum was the biggest winner on the blue-chip index, rising 3.34 percent to R1 593.21, followed by AngloGold Ashanti, up 3.16 percent to R280.04.

Meanwhile, gold prices rose about 2 percent yesterday. Spot gold gained 1.9 percent at a near four-week high of $1 793.86 (about R26 897) an ounce by 6.09pm.

US gold futures climbed 2.1 percent to $1 795.60 an ounce.

Other precious metals followed along, with spot silver rising 2.7 percent to $23.15 an ounce, platinum gaining 1.2 percent to $1 018.96 an ounce and palladium adding 3.4 percent to $2 114.71 an ounce. I Reuters