South Africa’s rand recovers after hitting 6-month low

PUBLISHED: Tue, 10 Oct 2017 10:49:23 GMT

 South Africa’s rand firmed against the dollar early on Tuesday, recovering from a six-month low hit in the previous session as emerging market currencies suffered a broad sell-off.At 0643 GMT, the rand traded at 13.7450 per dollar, 0.4 percent firmer than its overnight close on Monday.

“The dollar has faltered, bringing relief to the rand and other EM currencies,” Rand Merchant Bank currency analyst John Cairns said in a note. “Event and data risks are non-existent so sentiment will dominate trading.”

The rand fell as much as 13.8650 versus the dollar on Monday, its weakest level since April 11, as emerging markets were hurt by rising U.S. Treasury yields and risk-off mood following a visa spat between Turkey and the United States.

South Africa is highly susceptible to global investor sentiment as the country relies on foreign money to cover its large budget and current account deficits.

In fixed income, the yield for the benchmark government bond due in 2026 was down 4 basis points to 8.745 percent.

Stocks were set to open flat at 0700 GMT, with the JSE securities exchange’s Top-40 futures index barely changed.

Reporting by Olivia Kumwenda-Mtambo Editing by Jeremy Gaunt.

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