Rand off lows but still vulnerable

Johannesburg - The rand firmed against the dollar, bouncing from one-and-a-half week lows against the dollar as some level of calm returned to the markets that were spooked by a Greek call for a referendum on proposed EU bailout.

New vehicle sales data will likely take a backseat to global developments that have driven local markets.

The rand was trading at R8.03 to the dollar at 06:48 GMT, 0.9% firmer than Tuesday's New York close of R8.11.

"Today might be a bit quieter judging by US futures which are looking for a positive start, which should be beneficial for risky assets," said a dealer.

"You might see the rand a bit firmer and I think there'll be a lot less volatility than we saw yesterday."

After a sharp fall on Tuesday, the local bourse looked set for a positive start. The JSE's Top 40 - (Tradeable) [JSE:J200] December futures contract was up 0.8% before the 07:00 GMT start of trade.

Government bonds were a slightly weaker, with the yield on the 2015 bond up one basis point to 6.65% and that on the 2026 issue rising by the same margin to 8.435%.

After hitting a 28-month low of R8.4950 in September, the rand seemed to be on a tentative recovery path but failed several times to break resistance at R7.70 to the dollar.

It is a heavily traded currency and it has moved widely in line with fickle investor sentiment.

"All these moves are taking place within a range that's been unfolding since the end of September and until we get a decisive break, the two levels to watch are R8.20 and R7.70," said Judy Padayachee, technical analyst at Absa Capital.







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