Rand firmer on renewed trade talks between US and China

The rand was firmer early on Wednesday, traded back where it was before data last week that showed South Africa slipped back into recession in the second quarter, with renewed efforts in trade talks between the United States and China sparking investor appetite for riskier assets.

At 0700 GMT the rand was 0.5% stronger at 14.90 per dollar compared to a close of 14.97 in New York.

The rand traded below 15.00 for the first time since last Tuesday, when the economy entered a recession for the first time since 2009 as it shrank 0.7%.

Washington on Wednesday invited Chinese officials to restart trade talks in hopes a deal could be struck in the bitter tariff dispute between the world’s two biggest economies.

The Trump administration has laid out plans to activate tariffs on $200 billion worth of Chinese goods, hitting a broad array of internet technology products and consumer goods.

Local investors are awaiting the release of July’s mining production data at 0930 GMT, with the market expecting a 2.9% increase year on year from a 2.8% rise in June.

Bonds were firmer, with the yield on the benchmark paper due in 2026 falling 5 basis points to 9.145%.

Stocks were set to open stronger at 0700 GMT, with the JSE securities exchange’s Top 40 Futures index up 1%.