JOHANNESBURG (Reuters) – South Africa’s rand inched firmer early on Tuesday, mostly remaining within a recent range as currency markets globally drifted in low volume trade with investors still eyeing a breakthrough in U.S.-China trade talks.
At 0700 GMT, the rand was 0.16% firmer at 14.7900 per dollar compared to an overnight close of 14.8140.
The probability of a deal between Washington and Beijing receded after a report on Monday that Chinese officials were feeling pessimistic about the negotiations, suggesting a resolution to perhaps the biggest risk to the global economy remains elusive. [nFWN27Y0DQ]
The dollar subsequently took a knock, allowing emerging market currencies such as the rand to squeak in gains, although on a weekly basis the currency remains around the same levels, indicating mostly subdued activity in recent sessions.
The currency hardly reacted to the appointment of a new chief executive at ailing local power utility Eskom late on Monday.
Andre de Ruyter, former Nampak and Sasol CEO, begins the mammoth task of restructuring the heavily indebted utility whose power plants are struggling to keep the nation’s lights on in Jan. 2020.
Initial response to his appointment was lukewarm, with some analysts questioning his lack of experience in the engineering and energy sectors.[nL8N27Y4ST]
Bonds started on the backfoot ahead of a 1.51 billion rand auction of long-term government issues. The yield on the 2026 debt was up 2 basis points to 8.42%.
Reporting by Mfuneko Toyana; Editing by Jacqueline Wong