Bloomberg News

Rand Declines as Importers Buy Dollars in Post-Holiday Trade

January 07, 2013

The rand weakened as local importers took advantage of a December rally to buy foreign currency and the dollar advanced against most currencies after the U.S. created more jobs than expected in December.

South Africa’s currency depreciated as much as 0.6 percent and traded 0.4 percent lower at 8.5977 per dollar by 3:39 p.m. in Johannesburg. Yields on benchmark 10.5 percent bonds due December 2026 dropped 11 basis points, or 0.11 percentage point, to 7.28 percent.

Most South African businesses re-open today after the three-week summer holiday that started on Dec. 17. The rand rallied 5.1 percent in December, the best performer of 16 major currencies monitored by Bloomberg and traded as low as 8.6793 on Dec. 14.

“We are already seeing some importers in the market; guys getting back into their offices,” Ion de Vleeschauwer, chief dealer at Bidvest Bank Ltd. in Johannesburg, said by phone. “The rand is a lot stronger than it was when most businesses closed.”

The dollar advanced 0.2 percent against the euro to 1.3037 and was stronger against 12 of the 16 major currencies tracked by Bloomberg.

U.S. payrolls rose by 155,000 workers last month following a revised 161,000 advance in November, which was more than initially estimated. The median estimate of 82 economists surveyed by Bloomberg had called for an increase of 152,000.

To contact the reporter on this story: Stephen Gunnion in Johannesburg at sgunnion@bloomberg.net

To contact the editor responsible for this story: Vernon Wessels at vwessels@bloomberg.net


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