Rand Gains for Second Day as Chinese Growth Meets EstimatesJaco Visser
The rand gained, marking the second-best rally among emerging-market currencies against the dollar, after China, the largest buyer of South African raw materials, posted growth in line with estimates.
The Asian nation’s economy grew by 7.5 percent in the three months through June, compared with 7.7 percent the previous quarter and meeting the median estimate of 74 economists surveyed by Bloomberg. South Africa, which has the world’s largest known reserves of platinum and chrome, relies on metals for more than 50 percent of its export earnings.
“The market is relieved that this morning’s figure wasn’t worse,” John Cairns, a currency strategist at FirstRand Ltd.’s Rand Merchant Bank unit, said in an e-mailed note to clients.
The rand strengthened 0.9 percent to 9.8970 per dollar by 3:33 p.m. in Johannesburg, the most among 24 emerging-market currencies after the Turkish lira. The South African currency is the worst performer this year in the group, with a drop of 14 percent in the period. Yields on 10.5 percent government debt due December 2026 declined 8 basis points to 7.93 percent.
Foreign investors bought a net 531 million rand ($53 million) of South African bonds last week, bringing the total to 19.8 billion rand this year, compared with 93.5 billion rand a year earlier.
The spot price of gold was little changed at $1,285.73 per ounce after falling as much as 0.9 percent earlier today. South Africa is the world’s fifth-largest producer of the metal. Platinum gained for a sixth day in the longest winning streak since January, advancing 0.3 percent to $1,412.74 per ounce.