JOHANNESBURG: South Africa's rand traded stronger against the dollar on Monday, driven mainly by the greenback's broad losses against major currencies, including the euro.
Market watchers doubted the rand would sustain its gains, however, given South Africa's weak economic outlook. The latest setback is an electricity crunch that has forced state utility Eskom to implement rolling blackouts in some areas.
At 1607 GMT, the rand was trading up 0.54 percent at 11.0000 to the dollar compared with Friday's close.
Government bonds followed suit. The yield for the 2026 secondary market benchmark eased 3.5 basis points to close at 7.575 percent.
"I don't think (the rand's gains) is anything specific to South Africa, it's just a bit of dollar weakness that we are seeing," HSBC currency strategist Murat Toprak said.
The rand is still down more than 5 percent against the dollar since the start of 2014. Investors sold off the currency in the first half of the year amid strikes by platinum miners and factory workers.
The latest worry for Africa's most developed, but struggling economy is an energy squeeze as Eskom's creaking infrastructure fails to cope with electricity demand.
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