Rand stronger as dollar extends drop

The rand was stronger early on Monday, as the dollar extended last week’s fall after data showed US consumer prices fell for the first time in more than 2-1/2 years in December.

At 09:05, the rand traded at R16.84 against the dollar.

The dollar was down about 0.3% against a basket of currencies.

With decades-high inflation in the United States showing signs of cooling, investors are now betting the Federal Reserve may be nearing the end of its interest rate-hike cycle, and that rates will not go as high as previously feared.

No major economic data releases are expected in South Africa on Monday and US markets are closed, which could make for thin trading.

Later this week South African mining output and retail sales for November are due, as well as December consumer inflation.

The South African government’s benchmark 2030 bond was slightly weaker in early deals, with the yield up 2 basis points to 9.785%.

Source: moneyweb.co.za