Rand near strongest level in six weeks

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NewRandMoney Reuters.

Johannesburg - South Africa’s rand swung between gains and losses near the strongest level in six weeks before Finance Minister Pravin Gordhan’s fifth budget speech.

Gordhan is scheduled to deliver his budget in Parliament at 2 p.m. in Cape Town.

He will probably cut his 2014 growth forecast to 2.6 percent from 3 percent predicted in October and keep the fiscal deficit target of 4.1 percent of gross domestic product for the year through March 2015, according to the median estimate of 25 economists surveyed by Bloomberg.

The rand weakened less than 0.1 percent to 10.7381 per dollar by 9:55 a.m. in Johannesburg after advancing as much as 0.1 percent earlier.

The currency closes at 10.7287 against the dollar yesterday, the strongest level since January 10.

Yields on bonds due December 2026 dropped three basis points, or 0.03 percentage points, to 8.51 percent, heading for the lowest since January 23 on a closing basis.

“The rand remains very vulnerable,” Mohammed Nalla, head of strategic research at Nedbank Group Ltd. in Johannesburg, said in a note to clients.

The currency may trade between 10.65 to 10.85 against the dollar today, according to the note.

International investors bought a net 2.81 billion rand of South African bonds on February 25, according to data from Johannesburg Stock Exchange. - Bloomberg News

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