Johannesburg - South Africa's rand firmed against the dollar on Thursday, with dealers seeing a consolidation phase for emerging markets during a pick-up in global risk sentiment.
The rand was up 0.3 percent on the dollar to 11.0950 at 08:47 SA time, compared with an 11.1300 close in New York on Wednesday.
The unit has steadily pulled away from a five-year low hit last week, but its failure to break through the 11.06/07 area signals rand bulls will need more than just a lack of negative domestic news to post further gains.
The rand has failed to break through this resistance area in the last three sessions.
An unresolved two-week strike in the platinum sector by the Association of Mineworkers and Construction Union is keeping sentiment low in Africa's largest economy, and putting a lid on rand gains.
Government bonds took a cue from the firming rand and yields dropped 4 basis points on the benchmarks.
“With some stability returning to the rand this week, it has been an extremely difficult decision to bypass bond yields at current levels,” Rand Merchant Bank bond trader Thando Vokwana said in a note to clients.
“The relatively attractive high yields have seen the re-emergence of foreign bidding interest.”
The 2026 yield was at 8.685 percent while the 2015 note traded at 7.075 percent. - Reuters