Rand still on firmer ground

The rand is still anchored by a well-received medium term budget statement mid-week.

FILE:The rand hovered near the previous day's five-week highs against the dollar on Friday. Picture: Supplied.

JOHANNESBURG - The rand hovered near the previous day's five-week highs against the dollar on Friday, still anchored by a well-received medium term budget statement mid-week, in the absence of more immediate drivers.

Despite announcing a slightly wider budget deficit forecast for 2014/15, Finance Minister Nhlanhla Nene bolstered investor confidence in the currency and local bonds on Wednesday by vowing to clamp down on spending.

Analysts lauded his statement on the whole, saying it would go a long way to lessen the chances of more credit downgrades for Africa's most advanced economy.

The rand traded at 10.9300 to the dollar at 1545 GMT, up 0.4 percent from Thursday's close. It was within a whisker of Thursday's high of 10.9235, the currency's strongest level since 17 September.

The rand was however caught in a narrow range for much of Friday's session, reflecting a dearth of market moving news and data on the day.

"We've had a very quiet day and that goes for just about all the forex markets," RMB trader Jim Bryson said.

"There's a lack of drivers, no real news."

The rand was still among the strongest performers in a basket of 20 emerging currencies tracked by Reuters, surpassed only by Brazil's real, the Polish zloty and Latvia's lats.

The debt market was also sluggish, with the yield for the 2026 secondary market benchmark dipping just half a basis point to 7.91 percent.