JOHANNESBURG, July 20 (Reuters) – South Africa’s rand recovered its footing against the dollar on Tuesday after touching near 2-week lows overnight but remained vulnerable to risk aversion as the global economic recovery continues to stutter.
The JSE’s blue chip Top-40 September futures contract ALSIc1 was up 0.54 percent ahead of the 0700 GMT start of trade, suggesting a bounce on the bourse after miners and banks pulled stocks lower on Monday.
At 0652 GMT the rand ZAR=D3 was at 7.62 to the dollar, up 0.46 percent from Monday’s close at 7.6550.
But traders said the currency could revisit the 7.68 area it dipped to overnight as investors fretted about sluggish prospects for the global economy after last year’s recession.
“We’ve seen the dollar strengthening yesterday against the majors and that’s also supported the dollar against the rand,” a trader based in Johannesburg said.
“The consensus is that guys are taking a bit of risk off. I think we should find support towards 7.61 and we’ll trade up to 7.67/68 for the day.
Government bonds edged higher, with the yield on the benchmark 2015 bond ZAR157= falling five basis points to 7.70 percent while that on the 2036 ZAR209= note was down 4.5 basis points to 8.875 percent.
(Reporting by Stella Mapenzauswa; Editing by John Stonestreet)