JOHANNESBURG (Reuters) -The South African rand extended its gains in early trade on Wednesday, boosted by a weaker dollar ahead of the release of a domestic business confidence index and retail sales figures later in the day.
At 0625 GMT, the rand traded at 17.5450 against the dollar, about 0.4% firmer than its previous close, after strengthening more than 1% on Tuesday.
The dollar last traded flat against a basket of currencies.
“With the U.S. expecting further rate cuts and some dollar weakness, it is difficult to see where a sudden bout of weakness in the Rand will happen, bar the scoring of local own goals,” Wichard Cilliers, head of market risk at TreasuryONE, said.
“However, the markets are on a knife-edge, and headlines will drive markets in the short term,” Cilliers added.
The South African Chamber of Commerce and Industry (SACCI) will release its business confidence index at 0930 GMT, which will offer clues on private sector sentiment towards Africa’s most industrialised economy.
This will be followed at 1100 GMT by retail sales figures from the statistics agency.
South Africa’s benchmark 2035 government bond was marginally stronger in early deals, with the yield up 1.5 basis points to 9.65%.
(Reporting by Sfundo Parakozov; Editing by Andrew Heavens)
