Rand gains as trade war news lifts market sentiment
The rand started the week on the front foot on Monday morning, as positive news on the US-China trade war boosted global market sentiment.
News reports that China will raise penalties on intellectual property rights, which is one of the crucial topics discussed in the trade talks, renewed hope that the US and China may be moving closer to concluding a phase-one trade deal.
A move by ratings agency S&P Global to change the outlook on SA’s credit rating from stable to negative on Friday night had a muted effect on local markets on Monday morning, with the rand leading its emerging-market peers.
At 10am, the rand had firmed 0.16% to R14.6814/$ after ending last week at R14.70/$. It had strengthened 0.11% to R16.1947/€ and 0.11% to R18.8967/£. The euro firmed 0.13% to $1.1032.
Gold was down 0.25% to $1,458.73/oz while platinum was up 0.1% to $893.78. Brent crude added 0.2% to $63.7 a barrel.
The R2030 government bond was stronger, with yield falling half a basis point to 9.13%.
“We might see some consolidation in SA government bonds this morning after Friday’s weakness, but flows are expected to be muted as the market starts looking forward to the holidays with all the major event risks now out of the way,” said RMB fixed income analyst Michelle Wohlberg.
Source: businesslive.co.za