Rand firmer in early trade, eyes on central banks meetings

In fixed income, the yield on the benchmark government instrument due in 2030 was flat at 9.36%.

The rand firmed against a weaker dollar in early trade on Monday, with this week’s focus firmly on central bank meetings at home as well as in the United States and Britain.

At 0615 GMT, the rand traded at R16.67 per dollar, 0.43% firmer than its close on Friday.

“It’s a big week ahead as we await interest rate decisions,” said Bianca Botes, executive director at Peregrine Treasury Solutions in Pretoria.

The South African Reserve Bank will hold its three-day policy meeting from Tuesday, with its rates decision due on Thursday.

Following 300 basis points of Sarb cuts this year, in a poll taken by Reuters, 15 economists saw the repo rate on hold on Thursday while 10 predicted a modest 25 basis point cut to 3.25%.

Focus was also on the US Federal Reserve’s policy announcement on Wednesday after the world’s major central bank recently shifted its policy stance to keeping lower rates for longer.

The Bank of Japan and the Bank of England will announce respective policy decisions on Thursday.

In fixed income, the yield on the benchmark government instrument due in 2030 was flat at 9.36%.