Rand firms as dollar softens

The rand firmed in early trade on Tuesday, as the US dollar retreated from its 20-year peak on profit taking.

At 0700 GMT, the rand traded at R17.95 against the dollar, 0.68% firmer than its previous close.

The US dollar index, which measures the greenback against a basket of six major currencies, fell around 0.3% to 113.57, pulling back from a two-decade peak of 114.58 on Monday.

Economists at ETM Analytics said in a note the rand’s value against the dollar will likely remain extremely volatile.

“In the more immediate future, however, market sentiment appears to be stabilising, with equities and EM currencies regaining their footing overnight,” ETM Analytics added.

The government’s benchmark 2030 bond was stronger in early deals, with the yield down 6 basis points to 10.815%.