JOHANNESBURG (Reuters) -South Africa’s rand firmed on Friday, helped by strong Chinese data and a positive PMI return that showed South Africa’s private sector activity recovering from a downturn.
At 15:14 GMT, the rand traded at 18.1425 against the dollar, about 0.4% stronger than its previous close.
The dollar was down about 0.1% against a basket of global currencies, after comments from a Fed policymaker that “slow and steady is going to be the appropriate course of action,” when it comes to rate hikes.
The sentiment towards risk markets has improved slightly due to another round of positive Chinese data released on Friday, showing the economy is rebounding after COVID-19, said ETM Analytics in a research note.
“Although China alone cannot offset a slowdown in the US and Europe, it does help soften the blow and is welcome news for a country like SA (South Africa) with such strong trade links to China,” it said.
In even more positive news for the rand, South African private sector activity stabilised in February after a sharp drop the previous month, a survey showed.
The S&P Global South Africa Purchasing Managers’ Index (PMI) rose to 50.5 in February from 48.7 in January. A reading above 50 reflects growth.
On the stock market, the the Top-40 index and the broader all-share index closed about 1% higher.
The government’s benchmark 2030 bond was stronger, with the yield down 3.5 basis points to 10.140%.
(Reporting by Anait Miridzhanian and Nellie Peyton; Editing by Sonia Cheema and James Macharia Chege)
