Rand enjoys strong week as Moody’s turns more upbeat


The rand was to normal for gains in excess of 2% against the dollar today, despite some profit-taking on Friday, after Moody’s signalled it was actually unlikely to strip South Africa of the company’s last investment grade credit ratings this coming year.

That marks a turnaround for that South African currency, that has been dragged sharply lower since early August by poor economic data and fears that currency crises in Turkey and Argentina could spark full of exodus from emerging market assets.

Moody’s lead analyst for South Africa said on Thursday there’s “little chance” the united states would be downgraded on a rating review scheduled for in the future.

Read:?Moody’s expects ‘slow recovery’ in SA economy?

Her comments were noticeably more upbeat compared to a Moody’s research report released after data showed the other day that the economy fell into recession while in the second quarter.

First National Bank (FNB) analysts said the better positive tone from Moody’s became a rare item of very good news for just a country troubled with weak business confidence and policy uncertainty.

The reprieve from Moody’s “enables South Africa a chance to address its fiscal imbalances and in the Citi World Government Bond Index,” FNB analysts said, discussing raise the risk that the downgrade might cause South African bonds to generally be ejected derived from one of of the world’s major global bond indices.

At 1525 GMT the rand was 0.7% weaker at 14.88 in comparison to the dollar. Nevertheless it was 2.4% stronger than its close last Friday after rising for four straight sessions from Monday to Thursday.

Next week investor attention turns south African Reserve Bank (Sarb), which holds a fiscal policy meeting on Sept. 20. All bar among the economists polled by Reuters now predicted that your SARB would go away its main lending rate at 6.5%, while it weighs economic weakness against a pickup in inflation.

On the Johannesburg bourse, stocks ended a few days firmer, in keeping with global markets buoyed by expectations the fact that United States and China would open new trade talks.

The blue-chip top-40 index strengthened 0.90% to 50,441 points, although the broader All-share index was 0.74% firmer at 56,582 points.

“We are seeing fairly healthy markets on the back with the trade talks, along with the local market appears to be following suit,” said Ryan Wood, equities trader at Independent Securities.

Among Friday’s top gainers, Investec soared almost 10% after it announced intentions to spin off its asset management unit in a very surprise restructuring.?

Read:?Investec asset management spin off plan lifts shares