South Africa’s rand rallies on easing geopolitical risks

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JOHANNESBURG, May 10 – South Africa’s rand was
firmer on Thursday ahead of mining and manufacturing data, with
demand for the currency improved by an easing of geopolitical
nerves and some end-of-week squaring of positions by investors
as a key technical level approached.

* At 0650 GMT the rand was 0.44 percent firmer at
12.5000 per dollar compared to an overnight close of 12.5500 in
New York.

* “The rand has continued to trade within the
12.4500 to 12.7500 range, the short-term technical indicators
remain elevated and the potential for a short-term correction
appears significant,” said analyst at Nedbank Reezwana Sumad.

* Market have largely absorbed the shock of President Donald
Trump’s decision on Tuesday to pull the United States out of an
international nuclear deal with Iran.

* Bonds were also firmer in early trade, with the yield on
the benchmark 2026 paper down 3.5 basis points to 8.42
percent.

* Selling pressure on the Turkish lira, on concerns about
the central bank’s ability to rein in double-digit inflation,
also likely to have spurred some rand buying.

* Stocks opened firmer, with Johannesburg Stock Exchange’s
Top-40 index up 0.71 percent to 51,644 points.

* Statistics South Africa publishes March mining production
at 0930 GMT and manufacturing data at 1100 GMT before attention
moves offshore to a Bank of England lending rates decision and
U.S. consumer inflation figures.

-(Reuters)