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Rand at strongest level in a week

Johannesburg - The rand edged up to its strongest level in a week against the dollar on Tuesday, partly tracking firmer Asian currencies after gross domestic product (GDP) data in major commodity importer China came out stronger than expected.

The rand's gains could, however, be short-lived if Finance Minister Nhlanhla Nene predicts a wider budget deficit than seen in February and cuts growth forecasts for the ailing economy during his first mini budget statement on Wednesday.

Nene is expected to target a budget deficit of 4.4% of GDP for the 2014 to 2015 fiscal year, according to a Reuters poll.

The rand was at R10.9900 to the dollar at 08:43, up 0.29% from Monday's close, and breaching R11.0000 for the first time since October 15.

Government debt was also bid higher, pushing the yield for the 2026 secondary market benchmark 5 basis points lower to 8.025%.

"Today has seen a minor push back into risky assets with local government bonds the recipient of some investment capital and this filtered through into a rather blasé rand market," Standard Bank trader Inshaan Omar said in a note.

Some analysts however expected lukewarm appetite for local bonds during Tuesday's weekly auction for R2.35bn of paper, as some investors bet that the Treasury could increase issuance to plug a wider budget gap.

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Rand - Dollar
18.94
-0.2%
Rand - Pound
23.91
-0.1%
Rand - Euro
20.43
+0.2%
Rand - Aus dollar
12.34
+0.1%
Rand - Yen
0.13
-0.2%
Platinum
910.50
+1.5%
Palladium
1,011.50
+1.0%
Gold
2,221.35
+1.2%
Silver
24.87
+0.9%
Brent-ruolie
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Top 40
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+1.0%
All Share
74,536
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Resource 10
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Industrial 25
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Financial 15
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