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Africa, Forex

South Africa’s rand gains on vaccine hopes; eyes on cenbank policy meetings

JOHANNESBURG (Reuters) – South Africa’s rand firmed against the U.S. dollar early on Tuesday as renewed hopes for a COVID-19 vaccine lifted risk appetite, while investors awaited monetary policy directions from central banks this week.

At 0630 GMT, the rand traded at 16.5650 per dollar, 0.67% firmer than its close on Monday.

Helping sentiment, AstraZeneca resumed British clinical trials of its COVID-19 vaccine, one of the most advanced in development, on Monday, while Pfizer Inc and BioNTech SE proposed over the weekend expanding their Phase 3 vaccine trial.

Investors are also looking forward to central banks for direction, with the South African Reserve Bank deciding rates on Thursday.

The country’s central bank has cut rates by a total of 300 basis points this year to support an economy that was in recession before COVID-19 hit.

On the global stage, the U.S. Federal Reserve starting a two-day policy meeting on Tuesday, the first since unveiling a landmark shift to a more tolerant stance on inflation in August.

The Bank of Japan and the Bank of England are also scheduled to announce their respective policy decisions on Thursday.

Elsewhere, in fixed income, the yield on the benchmark government bond due in 2030 was down 4 basis points at 9.24%.

(Reporting by Olivia Kumwenda-Mtambo; Editing by Rashmi Aich)

FILE PHOTO: South African rand coins are seen in this photo illustration

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