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    South African rand gains as cautious Fed lifts risk appetite

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    Naija247news Editorial Teamhttps://www.naija247news.com/
    Naija247news is an investigative news platform that tracks news on Nigerian Economy, Business, Politics, Financial and Africa and Global Economy.

    JOHANNESBURG, Aug 30 (Reuters) – The South African rand gained on Monday, boosted along with other risk-sensitive currencies by investor confidence that the U.S. Federal Reserve was in no rush to step away from its massive pandemic-era stimulus.

    At 1558 GMT, the rand traded at 14.6475 against the dollar, roughly 0.6% stronger than its previous close.

    Fed Chair Jerome Powell told the Jackson Hole, Wyoming, central banking symposium on Friday that tapering of stimulus measures could begin this year but added the Fed would remain cautious. read more

    The rand regularly moves on shifts in expectations for U.S. monetary policy and global market sentiment.

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    “The backdrop is favourable for risk assets, allowing the rand and other high-beta (volatile) emerging market currencies to drift towards short-term support levels,” analysts at Rand Merchant Bank said in a note.

    Budget data showing a slightly smaller deficit in July than the same month last year did little to influence rand trading.

    Later this week, South Africa-focused investors will scrutinise trade figures (ZATBAL=ECI), credit extension numbers (ZACRED=ECI) and a PMI survey (ZAPMIM=ECI) for further clues about the status of Africa’s most industrialised economy.

    So far the economic recovery from COVID-19 has been uneven and halting, with arson and looting linked to the imprisonment of former President Jacob Zuma detracting from a strong first-quarter performance.

    Johannesburg-listed stocks fell on Monday, with the Top-40 Index (.JTOPI) closing 1.05% lower at 60,750 points and the broader All-Share Index (.JALSH) slipping 0.86% to 67,065 points.

    Shares in e-commerce giant Naspers (NPNJn.J) and internet subsidiary Prosus led the decline. Both fell over 3% on the news that China has forbidden under-18s from playing video games for more than three hours per week. read more

    The decision hit Chinese internet giant Tencent (0700.HK), in which Prosus holds a 29% stake.

    The benchmark 2030 government bond gained on Monday, with the yield dropping 5 basis points to 8.765%.

    Reporting by Alexander Winning and Emma Rumney; editing by Jonathan Oatis

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