Bloomberg News

Rand Strengthens First Day in Three on Greek Talks, Commodities

February 09, 2012

Feb. 8 (Bloomberg) -- The rand advanced against the dollar for the first time in three days as commodities and stocks gained on speculation Greece is making progress on measures needed to win international aid.

South Africa’s currency appreciated as much as 0.5 percent to 7.5205 per dollar, the strongest level this week. It traded at 0.1 percent stronger at 7.5527 as of 5.05 p.m. in Johannesburg. Against the euro it traded up 0.2 percent at 10.0054.

Greek Prime Minister Lucas Papademos will meet with the nation’s political leaders to negotiate terms required for a 130 billion-euro ($172 billion) rescue package. Standard & Poor’s GSCI Index of raw materials rose to a six-month high and South Africa’s benchmark stock index rose for the first day in three, tracking a rally in global emerging-market equities.

“With commodity prices still firm and markets hopeful of a positive conclusion to the Greek talks, the mood is still largely risk-on,” Nomvuyo Guma, a currency strategist at Standard Bank Group Ltd. in Johannesburg, said in e-mailed comments. “This should keep the rand on the front foot for now.”

Raw materials account for as much as 60 percent of South Africa’s exports, according to government data.

South Africa’s 6.75 percent bonds due 2021 declined for a fourth day, driving the yield up four basis points, or 0.04 percentage point, to 7.80 percent, the highest on a closing basis since Jan. 25.

--Editors: Peter Branton, Linda Shen

To contact the reporter on this story: Robert Brand in Cape Town at rbrand9@bloomberg.net Stephen Gunnion in Johannesburg at sgunnion@bloomberg.net

To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net


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