At 5pm, the rand bid at R11.9783 to the dollar, 10.25cents stronger than at the same time on Monday, finding some breathing space along with other emerging currencies despite the greenback recouping some losses.
Like other emerging market currencies, the rand has been hit by risk-off sentiment sparked by fears of US-China trade war and developments in Syria, but yesterday also found support from data showing China’s economy grew slightly faster than expected at 6.8percent in the first quarter.
“The rand performance has raised a few eyebrows. For a currency that usually is quite volatile it has been reasonably stable. This rally isn’t due to domestic factors alone,” said ETM Analytics economist, Halen Bothma.
“Ramaphosa’s investment initiative has encouraged some rand bulls. It’s improved the mood on the outlook side. It looks like the wheels on the political side are starting to turn and the rubber is hitting the road.”
On Monday, Ramaphosa appointed a team of business and finance experts to seek out $100billion (about R1.2 trillion) in investment to boost the ailing economy, and yesterday the International Monetary Fund raised its 2018 growth forecast for South Africa to 1.5percent.
Bonds were flat, with the yield on the benchmark 2026 paper steady at 8.08percent
Meanwhile, stocks were barely changed as the bullion sector weighed on the bourse.
The benchmark JSE Top40 index gained 0.11percent to 50176 points, while the all share index rose 0.16percent to 56826.74 points.
Bullion producer stocks fell 2.99percent, weighed down by a strengthening rand and a lower by gold spot price.
“It’s a consolidated market, with gold shares under pressure from the currency play strengthening,” said FFO Securities portfolio manager, Wilmar Buys.
Biggest losers in gold were Sibanye, down 5.61percent to R10.10, Harmony, which lost 4.29percent to R23.64, AngloGold Ashanti, which retreated 3.44percent to R107.81, Pan African Resources, 1.64percent lower at R1.20 and Gold Fields, which fell 0.93percent to R47.