Rand recovers as US trade deficit dampens dollar
The rand gained 0,38 percent to 12,018 per dollar, recovering from a slide towards its worst level.
JOHANNESBURG - The rand firmed on Tuesday after a mixed batch of US economic data stoked uncertainty about the pace of interest rate increases in the United States, denting the dollar and giving emerging markets a modest reprieve.
At 1526 GMT the rand had gained 0,38 percent to 12,018 per dollar, recovering from a slide towards its worst level in two weeks in the previous session as local economic data sapped appetite for the currency.
New vehicle sales for April fell 3,3 percent to their lowest in over 10 months on Monday, while power utility Eskom continued to cut electricity from the national grid as it battles to meet demand.
"The underlying bias is still higher, which favours a move towards firm resistance at 12,2000/2200 but momentum has clearly eased since last week," analysts from research house ETM Analytics said in a note.
South Africa's rand has shed more than three percent in value against the dollar since an April high of 11,9650, according to Thomson Reuters data, pushed lower by greenback strengthening on BETS of an interest rate hike by the end of 2015.
A wider-than-anticipated US trade deficit reported on Tuesday, its widest since 2008, dampened the dollar's recent strong run.
The patchy data also highlighted the uncertainty about the timing of a rate hike by the US Federal Reserve, a move that is expected to draw investors out of riskier but higher-yield emerging market assets.
Yields rose on government bonds, with the benchmark instrument due in 2026 adding four basis points to 8,09 percent.