Rand firms up as miners go back to work

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NewRandMoney Reuters.

Johannesburg - South Africa's rand firmed against the dollar on Wednesday, buoyed by broader weakness in the US currency and by the return to work of platinum miners after a five-month strike.

Tens of thousands of platinum miners returned on Wednesday, ending the longest and costliest strike in South Africa's history after platinum producers signed off on a wage deal with the Amcu union.

The rand had rallied to its highest in over three weeks after the wage deals were agreed the previous day, and traded not far from those levels on Wednesday, with broad-based dollar weakness lending support.

Still, gains were capped by concerns over the conflict in Iraq, sapping recent risk appetite that had been fuelled by confidence that the US Federal Reserve will not begin raising interest rates until mid-2015.

The rand was at 10.5785/dollar at 18:05 SA time, up 0.6 percent on its close in New York on Tuesday, and trading within the week's range so far.

“Our colleagues are looking for another range bound session for the euro/dollar... which leaves a similar outlook for the rand,” said Anisha Arora, emerging market analyst at 4Cast.

“Gains are also seen capped by the Middle East tensions and developments in Iraq, as well as continued strain in Ukraine despite a signed ceasefire,” Arora added, seeing the May 29 high at 10.5050 as the first barrier for the rand.

Yields on government bonds were up 3.5 basis points at 8.335 percent on the benchmark 2026 issue and climbed 4.5 basis points to 6.685 percent on the 2015 note. - Reuters

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