Rand holds steady as risk-on sentiment kicks in

DURBAN – The rand held steady as the domestic currency firmed as it ranged between R18.35 to R18.61 to the dollar on Tuesday.

Executive director at Peregrine Treasury Solutions Bianca Botes said that risk-on sentiment sees rand at the upper end of the trading range. “Growing optimism around a Covid-19 vaccine that is showing promising results helped to restore some positive market sentiment, while the Federal Reserve’s unwavering support for the US economy was also perceived as risk-on by the market.

Botes said that the rand continues to be driven by sentiment, which was essentially a balancing act as it switched between risk-on and risk-off as the pandemic unfolded. 

At 5pm the rand was bid 13c stronger than the same time bid on Friday at R18.27 against the dollar. Against the pound, it was 7c stronger at R22.39and bid at R19.97 against the euro. 

Nedbank CIB Research Analyst Reezwana Sumad said the rand has held steady as global appetite for risk has improved marginally. “Stock markets encountered support as optimism regarding a promising vaccine for COVID-19 grew, but despite data releases, this is unlikely to have any effect on the markets,” said Sumad. 

Source: iol.co.za