Rand over 1 pct firmer as dollar struggles

The rand continued a recent volatile run strengthening by over a percent against the dollar as US consumer.

Picture: Gadeeja Abbas/EWN.

JOHANNESBURG - The rand continued a recent volatile run on Monday, strengthening by over a percent against the dollar as US consumer spending declined by is biggest margin since late 2009.

By 1532 GMT the local unit had firmed 1 percent to 11.5250 per dollar, erasing Friday's sharp losses as global risk sentiment was soothed slightly by a recovery in world oil prices.

Crude oil futures rose as high as $55.62 a barrel, boosting commodity-linked and emerging market currencies against a broadly softer greenback.

"The world seems to think the rand should be the reserve currency of choice at the moment," said Ian Martin, a currency trader at Rand Merchant Bank. "And today seems to be generally a risk-on day because of the firmer commodity prices."

Bond yields edged up, with the government issue due in 2026 adding 3 basis points to 7.16 percent.

Earlier, South Africa's January new vehicle sales fell by 1.2 percent year-on-year, although sales rose on a month-on-month basis, due in part to falling domestic petrol prices which will decrease by a further 8.3 percent a litre on Wednesday.