Rand steady but set for weekly gain

The rand was flat in early trade on Friday, but was set for a weekly gain of more than 1% as positive economic growth data lifted it to a 10-month peak earlier this week.

At 0635 GMT, the rand traded at R15.02 versus the dollar. The currency was on track to finish the week 1.5% stronger.

“The rand has traded steadily firmer over the course of the week. However, a close above the R15.00 level is likely to signal a potential short-term consolidation around the current levels,” Nedbank analysts wrote in a note.

“This is as a stimulus package from the US appears unlikely and the world grapples with the effects of a surge in Covid-19 infection rates and subsequent lockdowns.

The rand touched its highest level since mid-February this week, boosted by encouraging third-quarter economic growth data and improvement in global risk appetite.

But data on Thursday showing manufacturing output fell 3.4% year-on-year in October while mining output dropped 6.3% brought the rally to a halt.

October retail sales data published on Wednesday also showed a decline, down 1.8% year-on-year.

Ten-year government bond yields were down a single basis point to 8.92% in early deals.