Rand stages comeback on global risk appetite
The rand fared a lot better on Tuesday morning, taking its cue from positive global markets. Investors were willing to dip back into risky assets, boosting the rand and local bonds in the process.
The stronger rand helps keep inflation in check, though it tends to hurt exporters.
The broad rally in risk assets happened despite no fresh developments in the continuing trade dispute between the US and China, which has held markets hostage for months. The two biggest economies have locked horns over trade tariffs, raising concerns about the effect on the global trade and broader world economy.
The dollar also appeared to take a breather after its recent rally against a basket of other currencies amid expectations of higher interest rates. Higher US rates tend to make the dollar more appealing as they boost returns on assets denominated in the currency, thus putting other currencies, such as the rand, under pressure.
At 10.49am, the rand was at R13.3174 to the dollar, from R13.4421, at R15.4309 to the euro from R15.5306, and at R17.2644 to the pound from R17.3973.
The yield on the benchmark R186 was at 8.69% from 8.73%.