South African rand gains in early trade on China policy pledges

Login

Register

http://www.clubofmozambique.com/

South African rand gains in early trade on China policy pledges

10:16 CAT | 25 Jul 2023

File photo: Reuters

The South African rand extended gains from the previous session in early trade on Tuesday, as China’s pledges to increase support for its sputtering economy boosted risk appetite globally.

At 0600 GMT, the rand traded at 17.6575 against the dollar ZAR=D3, about 0.5% stronger than its closing level on Monday.

The rand is up more than 6% this month against the U.S. currency, recovering further from a record low struck in early June.

China’s top leaders pledged on Monday to step up help for the economy amid a tortuous post-COVID recovery and signalled that there would be more to come for the property industry.

At around 0700 GMT the South African central bank will publish its leading business cycle indicator for May ZALEAD=ECI, giving clues about the outlook for Africa’s most industrialised economy.

The economy is expected to barely grow in 2023, with crippling power cuts and logistics bottlenecks among factors denting the country’s growth prospects.

Analysts at Rand Merchant Bank said the leading indicator probably fell further in May, citing slowing global growth and long-term domestic economic vulnerabilities among reasons for the projected decline.

The results of the government’s auction of 2037, 2044 and 2053 bonds are also due around 0930 GMT.

Source: Reuters