The South African (SA) Rand gained in early trade on Monday, supported by higher gold prices as local investors look towards the year’s last bit of economic data for clues on the health of Africa’s most industrialised economy.
The Rand traded at 16.84 against the Dollar , about 0.2% firmer than its previous close.
Gold held near a more than seven-week high on Monday on a weaker Dollar and lower United States yields, and as a major producer of precious metals, SA often benefits from firmer bullion prices.
“Through the past week, the Rand was able to capitalise on weaker Dollar sentiment. As the Dollar remained in a weaker trend, the Rand was able to sustain the break below 16.90/dlr and open the door for even more ZAR appreciation,” ETM Analytics said in a research note.
“Technically speaking, the Rand could now test levels in the 16.60s before the end of the year, which would play a significant role in reinforcing the virtuous cycle that has resulted in the Rand appreciating as much as it has this year,” ETM Analytics said.
Domestically-focused traders will examine the SA Reserve Bank’s bulletin for the third quarter which is expected to be released, offering insight into quarterly foreign direct investment and portfolio flows.
Later in the week investors will look to November consumer inflation data and producer inflation figures.
SA benchmark 2035 government bond was firmer in early deals, as the yield fell five basis points to 8.39%.
–Reuters–
