South Africa’s rand slips as investors pocket end-of-week profits

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JOHANNESBURG – South Africa’s rand edged lower on Friday, giving back gains from earlier this week, as investors took profits and awaited the next market catalyst.

At 0630 GMT the rand was 0.32 percent weaker at 14.1800 per dollar after closing at 14.1350 overnight in New York.

The rand rallied to 13.8700 on Wednesday following the U.S. midterm elections, breaking through the 14.00 long term resistance level for the first time in two months, lifted by a return of global risk appetite.

Investors have since taken the rand rally as a chance to buy the dollar cheap with an eye on volatility likely to come from the on-going trade spat between Beijing and Washington.

“The rand is expected to continue its bumpy ride but, for now, the levels are great to get your hands on some foreign currency,” said Bianca Botes, treasury manager at Peregrine Treasury Solutions.

The Federal Reserve policy statement last night, where it held interest rates steady and struck an expectedly hawkish tone fed into some dollar gains and put emerging market currencies under pressure.

Bonds were weaker, with the yield on the benchmark bond due in 2026 up 3.5 basis points at 9.18 percent.

Stocks were set to open lower at 0700 GMT, with the JSE securities exchange’s Top-40 futures index down 0.92 percent. – Reuters Africa

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