Thursday, 23 November 2017

Home » Business » Finance » SA rand stronger after decisions by rating agents

SA rand stronger after decisions by rating agents

November 28, 2016 12:50 pm

South Africa’s rand firmed to near three-week highs against the dollar and yields on government bonds fell on Monday after rating agencies Fitch and Moody’s affirmed the country’s investment-grade credit ratings.sa-rand-stronger-after-decisions-by-rating-agents

Africa’s most industrialised country, which is expected to see economic growth of around 0.5 percent this year, has been trying to avert a sovereign rating downgrade to junk status that would raise borrowing costs and deter investment. Fitch and Moody’s affirmed South Africa’s investment-grade credit ratings late on Friday. Fitch rates South Africa one notch above “junk”, while Moody’s has the sovereign two levels above sub investment grade.

At 08h09 GMT, the rand was at 13.8900 per dollar, a gain of 1.49 percent from its New York close on Friday. The currency was trading at its firmest levels since November 10, according to Thomson Reuters data. The yield for the benchmark government bond due in 2026 fell 21 basis points to 8.895 percent.

“The rand has had a gap open this morning which is likely due to the combination of a weaker dollar but also the positive news from the rating agencies,” Standard Bank chief currency trader Warrick Butler said in a note.

“The market should be cautious about expecting too much, having been disappointed so often in the past,” Rand Merchant Bank analyst John Cairns said.

On the stock market, the Top-40 index was flat while the broader all-share inched up 0.1 percent in early trade.

Author: Gesture Chidhanguro

SA rand stronger after decisions by rating agents Reviewed by on . South Africa's rand firmed to near three-week highs against the dollar and yields on government bonds fell on Monday after rating agencies Fitch and Moody's aff South Africa's rand firmed to near three-week highs against the dollar and yields on government bonds fell on Monday after rating agencies Fitch and Moody's aff Rating: 0
scroll to top