Rand shrugs off gold mining strike
August 9, 2005
Johannesburg - The rand recovered against the dollar yesterday, shrugging off news of the biggest mining strike in 18 years as the focus turned to domestic and US interest rates.
The rand moved in a thin band ahead of the Women's Day public holiday today, boosted by offshore investors selling dollars and euros.
At 5pm the rand was bid at R6.4462 a dollar, 1,87c stronger than its close on Friday. It hit an intraday low of R6.5050.
"The rand has been very quiet. Initially it followed the euro, but offers came back in from offshore names. With the holiday [today], there has been limited interest," said a Johannesburg trader.
About 100 000 South African gold miners downed tools yesterday to demand higher wages in the world's top bullion producer, but traders said the stoppage was largely dismissed in currency markets.
"It's not considered much of an issue ... Strikes in South Africa don't seem to last long," the trader added.
The gold price was softer on the day in London.
From tomorrow all eyes will be on the Reserve Bank's monetary policy committee, which is expected to hold interest rates steady at 7 percent.
Nineteen out of 20 economists polled by Reuters expect it to keep rates unchanged at the end of its two-day meeting on Thursday.
Elsewhere, the Federal Reserve will take centre stage amid expectations it will raise rates for the 10th consecutive time.
In London the dollar fell slightly against the euro ahead of the publication of economic data likely to show a widening in the US trade deficit.
The euro rose to $1.2371 in early European trading from $1.2355 late on Friday in New York. And by 5pm in Johannesburg the euro had held most of those early gains when it was bid at $1.2362.
South African government bonds were slightly softer in line with the rand. The yield on the benchmark R153 bond weakened 2 basis points to 7.425 percent. The yield on the R194 softened 2 basis points to 7.11 percent.
-Reuters-AFP
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