South Africa’s rand rose after the nation’s central bank boosted its main interest rate for the first time since 2016 and said its model signals four increases by the end of 2020.
“Given the tone of the speech the probability for more tightening is higher than I thought earlier,” said Guillaume Tresca, a senior emerging-market strategist at Credit Agricole SA. “The SARB will be really data dependent, driven by the rand movement.”
The currency extended its advance to as much as 1.3 percent against the dollar after the Monetary Policy Committee voted to increase the benchmark repurchase rate to 6.75 percent from 6.5 percent. The yield on the government’s rand-denominated bonds due 2026 fell eight basis points to 8.96 percent.