November 2, 2017 / 7:20 AM / 3 years ago

South Africa's rand firms as dollar retreats ahead of U.S. tax bill

Illustration photo shows a two-rand coin above a South African flag April 12, 2017. REUTERS/Thomas White/Illustration

JOHANNESBURG (Reuters) - South Africa’s rand advanced against the dollar early on Thursday, dropping below the psychological 14.00 mark, as the greenback slipped ahead of a U.S. tax bill that will be unveiled after a one-day delay. [FRX/]

At 0645 GMT, the rand traded at 13.9950 per dollar, 0.46 percent firmer than its overnight close, after earlier hitting a session high of 13.9075.

The dollar was also capped by reports that U.S. President Donald Trump plans to nominate Governor Jerome Powell as the next Federal Reserve chair. Powell is seen as relatively dovish than other candidates.

“The talk overnight that Governor Jerome Powell had been informed that President Trump will formally nominate him today as the next Fed chief generated very sharp gains in high-yield currencies,” said Rand Merchant Bank analyst John Cairns.

He added: “The speculation has allowed USD/ZAR to drop through 14.00, an important technical and psychological break that opens the way for a further rand recovery.”

Stocks were set to open lower at 0700 GMT, with the JSE securities exchange’s Top-40 futures index down 0.15 percent.

In fixed income, the yield for the benchmark government bond due in 2026 was down 0.5 basis points to 9.015 percent.

Reporting by Olivia Kumwenda-Mtambo

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below