South Africa's rand firms as Greece anxiety dampens euro - CNBC Africa

South Africa's rand firms as Greece anxiety dampens euro

Financial

by Reuters 0

South Africa's rand firms as Greece anxiety dampens euro.

South Africa's rand firmed on Tuesday as worries over Greece pushed Europe's common currency lower while emerging market assets recovered earlier losses.

At 1500 GMT, the rand had firmed 0.4 percent to 12.0950 against the dollar, also boosted by trouble in the eurozone, as details emerged of a European Central Bank proposal to increase insurance demands in return for emergency funding to Greek banks.

(READ MORES.Africa’s rand gains, eyes on Greece, power cuts)

The rand firmed by over half a percent against the euro to 12.9584, taking advantage of the weaker euro along with most of its emerging market peers.

"Movement on the rand is being driven by offshore factors. By the dollar and by Greece, which has been hurting emerging market sentiment," said Christie Viljoen, senior analyst at NKC Independent Economists.

March consumer inflation figures due on Wednesday is the sole domestic data release this week, with a Reuters survey of economists predicting the headline year-on-year figure rising to 4.1 percent from 3.9 percent in February.

"If inflation surprises on the up side we might see the rand move a little bit stronger, because that would confirm the next move on interest rates would be higher," Viljoen said.

Yields on government bonds were mostly lower, with the benchmark paper due in 2026 shedding 1.5 basis points to 7.95 percent.

"Bonds strengthened on the back of today's auction and the rand coming back a bit. We're going to run into sellers at around these levels," said bonds trader Richard Faber of Citibank.

Yields rose at South Africa government bond auction.

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