Money SA economy
The rand was stronger in early trade on Monday, supported by a host of positive factors, including firm commodity prices and news from China of greater foreign exchange flexibility.
At 8.50am the rand was bid at R7.41 to the dollar, R9.22 to the euro and R11.04 to the pound.
RMB analysts said in their morning report that China's announcement of a move toward greater currency flexibility yesterday is a mild positive for the ZAR, given the boost to commodity prices, the reduced risk of a trade spat, its negative implications for the USD and the hope for the rebalancing of the global economy.
Dow Jones Newswires reports the euro and Asian currencies are higher, fuelled by the Chinese announcement on the yuan. Gains were briefly pared after The People's Bank of China left its yuan reference rate against the dollar unchanged from Friday, though that proved a temporary blip as sentiment continued to tick up.
Despite the positive tone, analysts said China's move shouldn't be overstated, and will likely only result in a modest yuan appreciation.
