JOHANNESBURG (Reuters) –Â South Africa’s rand strengthened nearly 1 percent against the dollar on Tuesday, outperforming 24 emerging market peers amid hopes that a week-old strike by metal and engineering workers could soon be resolved.
The local unit hit a session high of 10.6750, its firmest since July 2, and was up 0.79 percent at 10.6875 by 1520 GMT compared with Monday’s close.
Government debt tracked the currency higher, and yields fell to their lowest in more than a week.
The paper maturing in 2015, which the secondary market uses as a benchmark, was down 9 basis points to 8.335 percent while the 2015 instrument dropped 6 basis points to 6.69 percent.
The rand has come under pressure in recent weeks as investors worry about the impact of strikes on South Africa’s frail economy.
On Tuesday the NUMSA union said it would take the “latest” offer from employers to its more than 200,000 striking engineering and metals members on Wednesday, possibly ending a stoppage that has hit car manufacturers.
“The rand has responded positively to news of a potentially imminent end to the latest strike, outpacing all emerging market peers on the session,” Tradition Analytics said.
