Rand weakens further as dollar gains on US bond spike
Local bonds are on the back foot after yields on the US 10-year treasury have risen sharply, in a vote of confidence in a strong US economy
The rand was weaker against the dollar on Thursday afternoon, but off its worst intraday levels, as the rampant dollar gave back some of its earlier gains against the euro. The euro weakened below $1.15, its softest level in two months, as US bond yields rose. The US 10-year peaked at 3.2245%, its highest level since July 2011, benefiting the dollar. “The spike in US treasury yields has driven demand for the greenback, which is back near last month’s peak, mostly, it would appear, at the expense of emerging-market currencies — again — and the yen,” Oanda analyst Craig Erlam said. Investor confidence in both the health of the US economy and the US Federal Reserve's steadfastness in its forward guidance received a further boost on Wednesday, when the central bank's chair, Jerome Powell, said that the nation’s economy was experiencing “a remarkably positive set of economic circumstances”. He added that he saw little risk of the current economic expansion being knocked off course. The ...
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