With South African bonds continuing to prove popular with foreign investors, the nation’s currency was able to advance on its American counterpart for a seventh day.
The Rand eased up by 0.3 per cent to achieve 8.8813 as of 11:37 local time.
At the current exchange rate 1 US Dollar will purchase 8.9185 South African Rand as of 12:00 pm GMT
Yesterday 1.45 billion Rand of debt was purchased by foreign investors, meaning that so far this week 4.9 billion Rand of debt has been bought. This follows last week’s sale of 5.4 billion Rand of debt.
The Rand has consequently gained by 4.2 per cent in the last 7 days.
According to one Johannesburg-based industry expert, ‘Offshore investors continue to seek yield in South Africa and while we don’t expect rosy economic data from South Africa today, it may be offset by offshore interest.’
Commodity-driven currencies like the Rand have also benefited from heightened risk appetite, inspired by the increasing odds of fiscal stimulus methods being maintained globally.
However, the Rand could experience fluctuations following the publication of a more disappointing-than-expected industrial report for South Africa.
The latest figures have shown that industrial production dropped by 2.9 per cent in February compared with the same period of the previous year. Economists anticipated a gain of 2.1 per cent to follow January’s 3.9 per cent advance.
After the data was released the Rand weakened to 8.9185 against the US Dollar.
While global economic developments are of interest, investors will also be looking ahead to the next piece of domestic data, South African retail sales figures, due for release next week.
Comments are closed.