JOHANNESBURG (The Southern African Times) – South Africa’s rand gained early on Monday as demand for emerging-market currencies was boosted by further easing of lockdown regulations globally, while a rally in gold prices also helped commodity-linked currencies.
At 0630 GMT the rand was up 0.5% at 18.4980 per dollar, compared with a close of 18.5900 on Friday in New York.
Countries around the world have continued to lift coronavirus restrictions. Infections have also declined, improving risk sentiment, which has been shaken in the last few sessions by a flare-up in U.S.-China tensions.
Washington’s move to block microchip supplies to Huawei Technologies is the latest Sino-U.S. flashpoint, with markets on edge for a response, after China’s Global Times newspaper flagged possible retaliation.
“The Sino-U.S. tensions and poor economic data are being offset by optimism over vaccine trials and declining global coronavirus cases as well as the restarting of global economies,” said Andre Botha, senior dealer at TreasuryONE.
Gold was up 1% on Monday to its highest in more than seven years. That partly a reflected investor fears of a deep recession in the United States, the higher price aided the currencies of countries that rely on sales of gold.
Bonds also gained, with the yield on the government issue due in 2030 down 14.5 basis points to 9.495%.
