Rand Climbs From 2-Week Low as Metals Rise on Fed Meeting

The rand rose from the lowest level in two weeks as metal prices advanced before the Federal Reserve’s decision on stimulus that drove demand for emerging-market assets. South African bond yields fell a second day.

The Fed’s Open Market Committee will maintain its $85 billion in monthly bond purchases at a meeting that ends today, according to a Bloomberg survey of economists. South Africa’s trade deficit probably shrank in September from a seven-month high the previous month, a report may show tomorrow.

The “main focus today will be on the Federal Open Market Committee meeting,” Standard Bank Group Ltd. analysts including Johannesburg-based Bruce Donald said in a note. An unchanged pace of bond-buying would be “rand-friendly,” they said.

South Africa’s currency appreciated 0.2 percent to 9.8743 per dollar as of 4:05 p.m. in Johannesburg, the first increase in four days. Yields on benchmark 10.5 percent bonds due December 2026 dropped two basis points, or 0.02 percentage point, to 7.91 percent.

Copper climbed to a one-week high in New York while tin, nickel and platinum also gained. Metals and other commodities accounted for 60 percent of South Africa’s exports in the first eight months of the year, according to government data.

The nation’s trade shortfall narrowed to 16.4 billion rand ($1.7 billion) in September from 19.1 billion rand the month before, according to the median estimate of 12 economists in a Bloomberg survey.

Before it's here, it's on the Bloomberg Terminal.
LEARN MORE