SA rand firms as central bank holds rates; stocks edge up

JOHANNESBURG — South Africa’s rand firmed yesterday, supported by the central bank’s decision to leave interest rates unchanged and expectations that the new US administration will unveil a massive stimulus package.

At 1600 GMT, the rand traded at 14.8250 versus the dollar, 0.5 percent stronger on the day.

The South African Reserve Bank kept the repo rate at 3,5 percent in a close decision.

Three out of five members of the monetary policy committee wanted to hold the rate while two preferred a rate cut that could have dented the appeal of investing in rand assets.

Republicans in the US Congress have indicated they are willing to work with President Joe Biden on one of his administration’s priorities, a $1,9 trillion stimulus plan, boosting the market mood globally.

The Johannesburg Stock Exchange recorded small gains, with concerns over the country’s coronavirus vaccine rollout plans counteracting buoyant offshore sentiment.

The All-share index gained 0,1 percent to end the day at 64,175 points, while the Top-40 index closed up 0.19% at 58,969 points.

The gold mining index was up 1,92 percent and the platinum index up 2.75 percent at market close.

In fixed income, the yield on the 2030 government bond was up 0,5 basis points at 8,725 percent.