The rand strengthened on Monday, aided by the US dollar being pinned near a one-month low and greater global risk appetite. Picture: Karen Sandison/African News Agency (ANA)
The rand strengthened on Monday, aided by the US dollar being pinned near a one-month low and greater global risk appetite. Picture: Karen Sandison/African News Agency (ANA)

Rand gains against subdued dollar

By Reuters Time of article published Apr 19, 2021

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JOHANNESBURG - The rand strengthened on Monday, aided by the US dollar being pinned near a one-month low and greater global risk appetite.

At 0710 GMT, the rand traded at 14.2625 versus the dollar, around 0.4 percent stronger than its previous close.

The dollar was dragged down by Treasury yields hovering near their lowest in five weeks after the US Federal Reserve reiterated its view that any spike in inflation was likely to be temporary.

Meanwhile, greater risk sentiment, fuelled by expectations that monetary policy will remain accommodative the world over, sent Asian shares to a new high.

Nolan Wapenaar, co-chief investment officer at fund manager Anchor Capital, said the rand was also rising on expectations of lower volatility, which will embolden carry-traders seeking out higher-yielding assets, and of a continued commodity rally.

"Combining these two themes means the rand will see some offshore support for a while," he said in a research note.

South African government bonds dipped, as the yield on the benchmark 2030 instrument rose 1 basis point to 9.07 percent.

Local data releases this week include the central bank's leading indicator on Tuesday and the consumer price index on Wednesday.

REUTERS

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