Picture: ISTOCK
Picture: ISTOCK

The rand was firmer against major global currencies on Tuesday afternoon, erasing earlier losses after a positive report from Moody's Investors Service.

Moody's earlier released a credit opinion on SA — which does not constitute a ratings action — in which it said SA's economic and fiscal performance was in line with other countries that had a Baa3 ratings: the last investment-grade ranking.

At 2pm the rand was flat at R14.1319/$, 0.17% stronger at R15.8324/€ and 0.77% stronger at R18.3995/£. The euro was flat at $1.1204.

The bid on the benchmark R186 was 8.46% from 8.485%.

The local currency was faring slightly better against the pound, as Brexit uncertainty escalated.

British MPs rejected four options for Brexit on Monday night, in a move that analysts said increased the chances the UK would leave the EU on April 12 without a deal.

None of the softer options put before MPs attracted a majority, London Capital Group head of research Jasper Lawler said. “This basically casts an even greater shadow over an already very grey situation.”

UK Prime Minister Theresa May is expected to hold an extended cabinet meeting on Wednesday, and may table her Brexit agreement before parliament for a fourth vote.

There is little major local or global news to give markets a clear direction on Tuesday, but domestic sentiment continues to be boosted by a decision by Moody's at the weekend not to release its long-anticipated credit-rating review.

Earlier, the weekly government bond auction was well subscribed, despite issuance increasing by R450m to R3.3bn in the first auction of the government's new financial year.

“The increase in issuance did little to sway interest as investors see the Moody’s lack of a review as an unofficial vote of confidence in the country,” Rand Merchant Bank analyst Michelle Wohlberg said. The number of bids received increased significantly from the week before.

gernetzkyk@businesslive.co.za