The rand strengthened to a 10-month high on Tuesday, a week before the general election, with analysts citing rising expectations that the outcome of the vote was unlikely to disrupt markets.
At 6.01pm, the rand traded at R18.07/US$, 0.6% stronger than its previous close. It earlier firmed to R18.03/$, a level not seen since August last year.
The dollar index was last trading around 0.05% stronger against a basket of global currencies.
A tracking poll by think-tank Social Research Foundation showed support for the ANC has risen in the weeks leading up to the 29 May election, suggesting it may only need a small coalition partner or could even win a majority.
“There is little doubt that the global environment has played a role, but the market’s positive mood vis-a-vis the ZAR seems to be due mostly to the optimism around a market-friendly election outcome,” said HSBC in a research note.
Earlier on Tuesday, data from the South African Reserve Bank showed South Africa’s composite leading business cycle indicator fell 1.9% month on month in March. The indicator collects data on business confidence, money supply and other factors, and hints at the outlook for the economy. — Tannur Anders, Bhargav Acharya and Kopano Gumbi, (c) 2024 Reuters