Johannesburg - South Africa's rand edged firmer on Thursday as inflation and retail data offered few surprises, keeping the currency within a recent range with a move firmer likely.
A cautious tone from the US central bank squeezed the dollar after January minutes from US Federal Reserve indicated some members of the bank wanted to keep rates near zero for longer, pushing the dollar lower while offering renewed appetite for riskier emerging market assets.
By 06h30 GMT the rand had inched 0.05 percent firmer to 11.6055 per dollar, a little off its week-low of 11.5800.
Domestic consumer inflation slowed more than expected to 4.4 percent year-on-year in January, while December retail sales rose 3.4 percent. Both figures provided little reason to sell the rand with local lending rates expected to remain accommodative in the short term.
“They do seem to love the rand and the high, real yield attraction the country has to offer,” Warrick Butler of Standard Bank said in a morning note. “And why not when inflation printed at 4.4% yesterday.”
Yields on local bonds fell, with the benchmark issue due in 2026 shedding 5 basis points to 7.645 percent.
Reuters