Rand Gains as Platinum Strike Ends; South African Yields Drop
The rand gained for a second day as an illegal strike at a South African platinum company ended and the dollar weakened against major peers before Federal Reserve Chairman Ben S. Bernanke speaks tomorrow. Bonds advanced.
Anglo American Platinum Ltd. (AMS), the world’s biggest producer of the metal, said miners at two of its operations returned to work today. Gold jumped to a two-week high as Bernanke prepares to speak tomorrow amid speculation he will provide further guidance on plans to scale back asset purchases.
“It looks like the strike news is starting to lose its effect,” Jim Bryson, head of foreign-exchange trading at Rand Merchant Bank, said by phone from Johannesburg. “The rand is strengthening in line with everything else. With Bernanke speaking tomorrow, the market is in wait-and-see mode.”
South Africa’s currency advanced 1.1 percent to 10.0513 per dollar as of 10:26 a.m. in Johannesburg. Yields on benchmark 10.5 percent bonds due December 2026 dropped nine basis points, or 0.09 percentage point, to 8.03 percent.
Bullion slid 23 percent last quarter as some investors lost faith in the metal as a store of value and Bernanke said the Fed may slow asset purchases this year if the economy continues to improve in line with its projections. Gold and platinum together account for about 20 percent of South Africa’s exports, according to government data.
To contact the reporter on this story: Robert Brand in Cape Town at email@example.com
To contact the editor responsible for this story: Vernon Wessels at firstname.lastname@example.org
Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.