South Africa’s rand firms ahead of budget speech, stocks fall

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South Africa’s rand was firmer against the dollar in early trade on Wednesday ahead of Finance Minister Pravin Gordhan’s unveiling of the medium-term budget policy statement at 1200 GMT.

 

* Rand at 13.6900/dlr by 0655 GMT, 0.50 percent firmercompared with the previous day’s close. * Gordhan’s statement, which will look at governmentspending priorities for the next the years, is meant to boostinvestor confidence and show his looming fraud case is notdistracting him. * “We expect today‚Äôs budget will be rand supportive … Withlocal elections out of the way, the budget has no populist tonesto strike but National Treasury will need to tightly hold to theexpenditure ceiling and allude to progress on reforms given thepolitical uncertainty and rating pressure,” said Rand MerchantBank currency strategist John Cairns in a morning note. * In fixed income, the yield for the benchmark governmentbond due in 2026 down 5.5 basis points at 8.735 percent. * Stocks open lower in line with global peers, withbenchmark Top-40 index down 0.83 percent to 44,828.

 

(Reporting by Ed Stoddard; Editing by Ralph Boulton)

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