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South Africa’s rand slips on subdued risk taking

South Africa’s rand slips on subdued risk taking

2020-10-22

 

South Africa’s rand slipped early on Thursday from a one-month high hit in the previous session, as the slow pace of U.S. stimulus talks weighed on appetite for riskier assets, such as emerging markets currencies.

At 0600 GMT, the rand ZAR=D3 traded at 16.3700 against the U.S. dollar, 0.28% down from its previous close.

Against the backdrop of a weak local economy, the rand has in recent weeks mainly been driven by offshore sentiment, particularly the outlook for further monetary and fiscal stimulus for the world’s major economies.

On Wednesday, the currency firmed to 16.2575, its strongest since Sept. 18, as risk-taking globally was boosted by hopes of a breakthrough in stimulus talks in the United States. global investor sentiment worsened after U.S. President Donald Trump on Wednesday accused Democrats of refusing to craft an acceptable compromise, following reports of progress earlier in the day. FRX

South African government bonds firmed in early trade, with the yield on the benchmark 2030 bond ZAR2030= down 0.5 basis point to 9.29%.

 

Source: Reuters

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