JOHANNESBURG (Reuters) -The South African rand gained on Monday, supported by risk-on sentiment across markets, while stocks on the Johannesburg bourse ended slightly higher.
The rand is highly sensitive to shifts in global risk appetite. It received a boost last week when U.S. jobs data raised hopes the Federal Reserve could soon soften its stance on interest rates.
At 1515 GMT, the rand traded at 17.7000 against the U.S. dollar, about 1.0% stronger than its previous close.
The dollar index, which tracks the dollar against a basket of currencies, fell by more than 0.6%.
Also supporting the rand were growing expectations that the South African Reserve Bank (SARB) could announce another big interest rate hike later this month.
Analysts at Investec said the SARB was “increasingly expected to deliver a 100 basis point hike, which would bring the cumulative size of South African and U.S. interest rate hikes in line in the current cycle”.
On the Johannesburg Stock Exchange, the Top-40 and the All-share indexes closed up around 0.1% and 0.2%, respectively.
The government’s benchmark 2030 bond was stronger, with the yield down 7 basis points at 10.555%.
(Reporting by Anait Miridzhanian and Alexander Winning; editing by Barbara Lewis)
