Picture: REUTERS
Picture: REUTERS

The rand was on track for its second day of gains on Tuesday as progress in finding a Covid-19 vaccine lifted risk sentiment.

US biotech firm Moderna said on Monday that an early trial of its coronavirus vaccine showed promising results as investors worry that prolonged lockdowns may sink the global economy deeper into recession.

At 11.56am, the rand had strengthened 0.45% to R18.2513/$, 0.15% to R19.9737/€, while it was flat at R22.3400/£. The euro had firmed 0.28% to $1.0947. 

“The rand continues to be driven by sentiment, which is essentially a balancing act as it switches between risk-on and risk-off as the pandemic unfolds.” said Peregrine Treasury Solutions executive director Bianca Botes. 

The yield on the R2030 government bond had fallen 54 basis points to 9.05%. Bond yields move inversely to prices.

“Growing optimism around a Covid-19 vaccine that is showing promising results helped restore some positive market sentiment, while the US Federal Reserve’s unwavering support for the US economy was also perceived as risk-on by the market,” she said.

Gold added 0.18% to $1,735.30/oz while platinum was down 0.95% to $811.25 Brent crude dropped 2.46% to $34.54 a barrel.