SHOPRIT: 16,588 +234 (+1.43%)
South Africa's rand falls as risk demand cools, stocks inch up
JOHANNESBURG, Feb 26 (Reuters) - South Africa's rand fell on
Tuesday, ending a rally that had seen the currency breach a key
technical mark, amid cooling demand for emerging-market
currencies that had been fuelled by optimism over U.S.-China
At 1508 GMT, the rand was 0.43 percent weaker at
13.8850 per dollar, compared to a close of 13.8250 on Monday.
The rand has traded below the psychologically significant
14.00 per dollar level for the past few sessions as last
Wednesday's budget lowered market bets of a credit rating cut by
Moody's after a week of power cuts by utility Eskom had spooked
Demand for the rand and other emerging market currencies in
the previous session was boosted by U.S. President Donald
Trump's decision to delay a deadline for increasing tariffs on
But risk demand faded on Tuesday after Trump said a
U.S.-China trade deal is not a certainty, even though talks have
"With easing trade tensions seen to be stimulating risk
appetite and the dollar likely to weaken further on Fed rate
pause expectations, the South African rand, like many other
emerging market currencies, has scope to appreciate further,"
Lukman Otunuga, research analyst at FXTM, said in a note.
"In regards to the technical picture, technical traders will
continue to closely observe how the USDZAR behaves around the
Federal Reserve Chairman Jerome Powell said on Tuesday
rising risks and recent soft data shouldn't prevent solid growth
for the U.S. economy this year, but the Fed will remain
"patient" in deciding on further interest rate
Bonds firmed, with the yield on the benchmark 10-year
government issue falling 4.5 basis points to close at
On the bourse, stocks ended higher, led by Shoprite after the
retailer gave a somewhat upbeat outlook after reporting its
worst half-year performance in a decade.
The blue-chip JSE Top-40 index was up 0.66 percent
at 49,965 and the broader All-share index ended 0.65
percent higher at 56,242.
Shoprite topped the gainers list on the benchmark
index, rising 4.89 percent to 169.75 rand, after the company
said it had seen evidence of improved sales since January.
(Reporting by Olivia Kumwenda-Mtambo and Tiisetso Motsoeneng
Editing by Gareth Jones)
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