Rand firmer ahead of Moody’s rating decision

The rand firmed against the globally hobbled dollar early on Friday ahead of the country’s credit review announcement by ratings agency Moody’s later in the day.

The rand was 0.85% stronger at 14.51 per dollar at 06:50 GMT, having closed in New York at 14.63.

The rand is expected to trade between 14.35 and 14.70 to the dollar on Friday, NKC African Economics wrote in a note.

Moody’s is the last of the top rating agencies to have Pretoria’s long-term foreign-currency debt in investment grade.

South Africa‘s stable outlook on its credit rating means there is little chance of a downgrade, Moody’s said on September 13, but a commitment to fiscal consolidation at the October budget would be key to maintaining the positive rating.

The rand was supported by the slightly-better-than-expected South African manufacturing production data for August.

Globally, the US dollar traded at its lowest level this month against its major peers on Friday as declining US treasury yields and further losses on Wall Street soured sentiment.

In fixed income, the yield on the benchmark government bond due in 2026 fell 1 basis points to 9.25%.

Stocks are due open firmer at 07:00 GMT, with the JSE securities exchange’s Top-40 futures index up 1.10%.