South Africa’s rand opened steady versus the US dollar on Tuesday after it was sold off in overnight trade in New York, traders said. The rand was traded at R10,27/dollar at 0655 GMT after trading at R10,342/dollar in late Johannesburg trade on Monday.
”It was sold off in New York, and it’s now trading firmer,” one trader told Reuters. The trader added that it was too early to say whether the rand had found a direction after its big swings ranging from R10,18/dollar to R10,475/dollar on Monday.
”We’ve got to watch the ground. Nothing shows a trend’s been found and we could yet see the volatility of yesterday and last week,” a senior trader said.
In the past few days, the rand has been unable to draw much support from the dollar’s weakness, signalling an end to a sustained rally which has seen it appreciate 15% against the US unit this year.
The rand is the third best performing currency in the world to date, after Indonesian and New Zealand currencies, according to Reuters data. Last Monday, the rand touched R10,75 against the dollar, its weakest level for two months.
Bond traders said they were facing another quiet day, although sentiment had improved after a slight recovery in Brazil.
”Volumes are very light. A bit of a recovery in Brazil is helping support the market,” said one trader, adding that the currency was trading at firmer levels compared to late on Monday, which was good news for the bond market.
The yield on the longer-dated R153 bond, due 2010, traded at 11,95% versus 11,97% on Monday while the yield on the most traded R150, due 2005, was traded at 11,845% versus 11,85% at close on Monday. – Reuters