Rand extends gains as investors mull ANC NEC’s ‘non-event’
The premium investors demand to hold local sovereign bonds is the highest since January 3, Bloomberg reports
The rand was in its second session of gains on Thursday morning, leading emerging-market currencies while investors digested the ANC's statement on its plans to grow the domestic economy.
The ruling party agreed on various proposals to boost economic growth and said it would finalise a plan for debt-ridden Eskom by the end of the month as President Cyril Ramaphosa faces pressure to implement his promised structural reform agenda.
“The national executive committee (NEC) media statement was actually a non-event. Lots of chat about what could happen, but that’s been the case for governments since the dawn of time. What people need to see is delivery and unfortunately that has been as rare as an Indian test wicket taken by SA,” said Standard Bank currency dealer Warrick Butler
At 10am, the rand firmed 0.76% to R15.1756/$ — reaching R15.15 in intraday trade, 0.91% to R16.6068/€ and 0.9% to R18.6398/£. The euro had weakened 0.15% to $1.0943.
“The first two days of the week, the Rattler [rand] underperformed emerging-market peers as the market lost patience with the NEC and the lack of news, while yesterday, that elastic band rebounded with the rand a top performer on the day despite a bit of a global meltdown,” Butler said.
Gold was flat at $1,498.78/oz while platinum added 0.13% to $888.97. Brent crude was up 0.28% to $57.6 a barrel.
The benchmark R186 government bond was stronger, with the yield falling 3.5 basis points to 8.25%. Bond prices move inversely to bond yields
The premium investors demand to hold local sovereign bonds is the highest since January 3, according to Bloomberg.