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Rand Gains Most in a Week After South Africa Trade Data Surprise

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Dec. 30 (Bloomberg) -- The rand strengthened the most in a week against the dollar after South Africa recorded a surprise trade surplus for November.

Africa’s largest economy reported a trade surplus of 770 million rand ($73 million) in November, compared with a 9.4 billion rand deficit estimated by eight economists surveyed by Bloomberg. Exports were boosted by a 34 percent jump in vehicle shipments following a six-week strike at automakers including Bayerische Motoren Werke AG and Toyota Motor Corp. that ended in October.

“It’s encouraging for the rand,” John Cairns, a currency strategist at FirstRand Ltd.’s Rand Merchant Bank unit, said by phone from Johannesburg. “It suggests a lower deficit than anyone had been fearing in the fourth quarter.”

The rand gained as much as 0.7 percent and traded 0.4 percent stronger at 10.4841 per dollar by 3:09 p.m. in Johannesburg. The yield on benchmark government bonds due December 2026 rose eight basis points, or 0.08 percentage point, to 8.27 percent, the highest on a closing basis in almost three weeks.

The rand slid 19 percent against the dollar this year as a slump in metal prices and demand for resources from Europe and China compounded South Africa’s labor woes. The nation’s trade gap almost doubled to 74.7 billion rand in the first 11 months of the year, compared with the same period in 2012.

Foreign investors sold a net 1.9 billion rand of South African bonds this month to Dec. 27, according to data from the Johannesburg Stock Exchange.

To contact the reporter on this story: Jaco Visser in Johannesburg at avisser3@bloomberg.net

To contact the editor responsible for this story: Vernon Wessels at vwessels@bloomberg.net

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