Dec. 29 (Bloomberg) -- The rand strengthened against the dollar, paring the biggest yearly decline among major currencies, as exporters converted their foreign earnings.
South Africa’s exchange rate appreciated as much as 1 percent to 8.1217, the most since Dec. 22. It traded 0.6 percent higher at 8.1532 as of 3:20 p.m. in Johannesburg, bringing its retreat this year to 19 percent, the biggest slump among the 12 most-traded currencies tracked by Bloomberg. Against the euro, the rand gained 1 percent to 10.5048, trimming its decline this year to 16 percent.
“It’s the year-end, and there are a few exporters around” buying rand, Jim Bryson, head of foreign-exchange trading at Rand Merchant Bank, a unit of South Africa’s second-biggest lender, said by phone from Johannesburg.
South African exporters are required to repatriate foreign currency within six months in line with the Reserve Bank’s exchange controls.
The rand rebounded from a 0.8 percent decline yesterday, after the European Central Bank said its balance sheet soared to a record after last week’s lending to banks to stave off a credit crunch from the region’s debt crisis.
South Africa’s currency stayed stronger after a report showed the nation’s trade gap narrowed to 8 billion rand in November, from 9.6 billion the month before, after exports of mineral products and chemicals climbed.
South Africa’s 6.75 percent bonds due 2021 gained for a second day, cutting the yield one basis point, or 0.01 percentage point, to 7.96 percent.
--Editors: Ash Kumar, Linda Shen
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