Rand firmer, bonds flat in thin market
Johannesburg - The rand traded slightly firmer against the dollar on Monday but could turn weaker as investors remain risk-wary globally, wondering if the United States would go over a “fiscal cliff” of harsh spending cuts and tax hikes.
The rand traded at 8.58 at 0725 GMT, up just 0.23 percent from Friday's close at 8.60.
But the greenback was steady to firmer against major currencies as the year-end deadline approached to reach a deal to halt going over the fiscal cliff.
Economists say the harsh tax increases and budget cuts could thrust the world's largest economy back into a recession, unless Congress acts quickly to ease the economic blow.
South African government bonds were flat in a lacklustre session as most market players took the day off ahead of the Christmas holiday.
The yield on the 14-year issue, which is the market benchmark, was unchanged from Friday's last level at 7.225 percent, as was that for the three-year issue at 5.3 percent.
“The market is open but no one has put up a price yet. There are brokers out there but there hasn't been a trade,” said Kgosi Tshite, a bond trader at Investec. - Reuters