Rand pares early gains, technicals offer support

The rand was firmer in early trade on Wednesday in a technical rebound after slumping as much as 2% in the previous session to seven-month lows on jitters triggered by the escalating tit-for-tat US/China trade war.

At 0650 GMT, the rand was up 0.11% to 13.72/dollar, paring earlier gains that had seen it reach 13.65/dollar.

Technicals point to a rebound or at least support after the currency swung deeply into oversold levels, according to momentum indicators tracked by analysts.

But dollar strength or a return of rolling power cuts could cap gains and the market will also be looking out for May CPI data due at 0800 GMT.

In a market note, NKC African Economics pegs the rand’s range at 13.55 to 13.85/dollar.

In fixed income, the yield for the benchmark government bond due in 2026 was down 1.5 basis points to 9.155%.

Stocks also seen rebounding, partly on technical factors, with the JSE Top 40 Futures Index up almost 1.2%.