JOHANNESBURG - The rand raced to a seven-week high against the dollar yesterday bolstered by data showing a better than expected trade surplus in June, while stocks ended higher.
At 5pm, the rand bid at R13.0946 to the dollar, 4.99cents stronger than at the same time on Monday, about 0.49percent firmer than its close on Monday and its strongest level since June11, according to Thomson Reuters data.
South Africa’s trade surplus widened more than expected to R12billion in June as exports in precious, base metal and vehicle parts jumped, easing pressure on the economy.
Analysts said the large surplus was a sign the current account was narrowing, which would lessen the impact of any reversal of portfolio flows.
“Although economic growth has been sluggish with the unemployment rate rising to 27.2percent, the rand showed its resilience as it continues its journey down to the 13.00 mark,” said Bianca Botes, a corporate treasury manager at Peregrine Treasury Solutions.
“As global trade tensions ease and investors once again seek yield in emerging markets, the rand is enjoying some respite for the time being.”
The rand has rallied in the past month to become one of the top performing emerging market currencies, due mainly to positive turn in sentiment, but remains at risk to offshore events, particularly the ongoing trade tiff between the US and China.
In fixed income, the yield for the benchmark paper due in 2026 was flat at 8.59percent.
On the bourse, shares rose in line with European markets.
The blue chip JSE Top40 index closed up 0.17percent at 51315 points, while the broader all share index ended 0.21percent higher to 57432.46 points.
“Commodity shares led the upward momentum. There is stability in the markets,” said FFO Securities portfolio manager, Wilmar Buys.
Among the top gainers, Glencore gained 3.22percent to R57.76, Anglo American Platinum advanced 3.05percent to R404.50 and diversified miner Sibanye-Stillwater rose 1.65percent to R8.
Losers included Naspers, down 2.2percent to R3 242, Mediclinic, which dropped 2.1 percent to R88.50 and Richemont, which closed 1.01percent weaker at R115.15.