JOHANNESBURG – South Africa’s rand inched firmer on Wednesday, still riding the wave of positive sentiment following Cyril Ramaphosa’s election as the leader of the ruling African National Congress and also helped by a global rally in resource prices.
At 0630 GMT the rand was 0.08 percent firmer at 12.4975 per dollar compared to a close of 12.5075 in overnight trading in New York.
Volumes were thin following holidays on Monday and Tuesday, exaggerating moves in either direction. The currency lost ground in the Asian and U.S. sessions before recovering, with trade mainly at the 12.50 technical mark.
The unit is now trading below its 200-day moving average, a confirmation of the firmer price trend likely to spur further buying as investors who were short the rand looked to position for the bull rally.
Commodity prices hit multi-year highs, although gold edged slightly lower on day, as optimistic views on Chinese demand for metals and higher oil prices aided resource-linked currencies.
Stocks were set to open lower at 0700 GMT, with the JSE securities exchange’s Top-40 futures index down 0.56 percent.
Bonds were flat, with the yield on the benchmark government paper due in 2026 unchanged at 8.715 percent.(Reuters)