WEDNESDAY, 10.30AM
GROSS reserves held by the Reserve Bank in June rose only R300-million form the previous month, to R22,1-billion — well below expectations.
The figures were released after Tuesday’s close of the Johannesburg Stock Exchange. The day had seen the relaxation of exchange controls and a 16-month high in the bond market, based on expectations of a strong rise in reserves. The rand also surprised by gaining slightly against the dollar, closing at R4,5279 against Tuesday’s R4,5355.
Analysts put the disappointing increase in reserves down to debt repayment, higher quarterly interest remittances, dividend payments and continued Reserve Bank involvement in stabilising the value of the rand in currency markets.
Gross reserves had been expected to rise by around R5-billion to nearly R25-billion in June. The R1,6-billion proceeds from government’s samurai bond offer swelled the reserves in June, but the Reserve Bank said a total of R2,2-billion flowed out, including a R465,4-million debt repayment to the International Monetary Fund. Foreign credit utilised remained at R1,8-billion, while the R2,2-billion proceeds of the government’s yankee bond issue were not included in June’s figures.