JOHANNESBURG: The South African rand was a touch firmer against the dollar on Thursday, with traders expecting it to stay in a narrow range ahead of next week's interest rates decision and a credit rating review from Moody's. Stocks also rose, lifted by Africa's largest mobile operator MTN.
The benchmark Top-40 index closed 1.3 percent higher at 44,171 points, while the All-Share index gained 1.2 percent to 50,617 points. The rand traded up 0.35 percent at 14.2950 per dollar by 1610 GMT.
"The rand is probably going to start quieting down ahead of the big events from next week," Rand Merchant Bank trader Jim Bryson said, referring to the last monetary policy meeting of the year and a credit rating review from Moody's.
The central bank is expected to keep domestic rates unchanged at 7 percent next Thursday, a decision which could put pressure on the rand, given that investors are bracing for a US rate hike in December.
Investors are also worried South Africa could see its credit rating lowered over weak economic growth and political skirmishes that have called the independence of key departments such as the Treasury into question.
The first review is due on Nov. 25 from Moody's, which rates South Africa two notches above "junk". Peers Fitch and S&P, which have it just one level above sub-investment grade, will give their verdicts in December.
Government bonds closed slightly firmer on Thursday, with the yield for the 10-year benchmark easing 2 basis points to 8.995 percent. On the bourse, MTN, which has operations in major oil producing nations, rallied on higher crude prices.
Shares in MTN, whose biggest market is Nigeria and has a joint venture with Irancell in Iran, gained 3.1 percent to 114.30 rand. "MTN is probably just tracking oil," said Cratos Capital trader equities trader Greg Davies.
Trading volumes on the South African bourse were below par, with around 245 million shares changing hands, compared with last year's daily average of 296 million.
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