Rand stronger on positive emerging-market sentiment
Emerging-market currencies regain lost ground as the Turkish lira strengthens
The rand gained nearly 1% on the dollar on Tuesday afternoon as emerging-market sentiment turned positive with a stronger gold price also helping the local currency.
The dollar was steady at just below $1.16 to the euro.
The rand and the Russian rouble all benefited from a stronger Turkish lira, which hit its best level against the dollar in more than two months.
“The Turkish lira is the standout performer in emerging markets, having strengthened for nine straight sessions,” said Société Générale, adding that “the court ruling last Friday, to release US Pastor Brunson, has nudged the lira closer to 5.70 to the dollar.”
Investors have turned more cautious on the dollar and are showing interest in other safe-haven investments, said FXTM analyst Jameel Ahmad. “Capital flows are coming back into gold, which has the potential to benefit the rand further.”
The gold price rose 0.35% to $1,231.14 an ounce, the highest level in three months.
At 2.55pm, the rand was at R14.2358 to the dollar from R14.3648, at R16.4908 to the euro from R16.6339, and at R18.8058 from R18.8914. The euro was at $1.1585 from $1.1579.
Local bonds showed little movement with R186 bid at 9.20%, largely unchanged from Monday’s levels. The US 10-year treasury was last seen at 3.1629% from 3.1563%.