JOHANNESBURG – South Africa’s rand strengthened on Tuesday as the U.S. dollar retreated from a one-month high with traders keeping a close eye on the policies of the incoming Joe Biden government.
At 0635 GMT, the rand traded at 15.1300 versus the U.S. dollar, 0.23% firmer than its previous close.
The dollar slipped from close to its highest in nearly one month as caution set in before U.S. Treasury Secretary nominee Janet Yellen testifies later in the day, and global investors hunted for higher-yielding assets in emerging markets.
The rand has mainly taken its cue from global drivers so far this month, but this week South African-focused investors will look to a slew of economic data for clues on the health of the domestic economy in the last quarter of 2020.
The South African economy was in recession even before the COVID-19 pandemic set in, while the coronavirus crisis has exacerbated its woes.
Mining figures for November are due later in the day, while November retail sales figures and the December consumer price index will be published on Wednesday.
On Thursday, the central bank will announce its latest interest rate decision in which most economists expect it to hold the repo rate at 3.5%, but a small minority is predicting a rate cut.
Government bonds also firmed in early deals, with the yield on the instrument due in 2030 dropping 4 basis points to 8.815%. – Reuters