The rand rose to its strongest level in more than a week as investors gauged the currency’s slump this year, the worst amongst emerging-market currencies, is overdone. Bonds gained, driving two-year yields to record lows.
The rand declined for a fourth day, reversing an earlier gain, as importers bought dollars, betting South Africa’s currency will weaken as Europe’s sovereign-debt crisis damps demand for riskier assets.
The rand advanced for the first time in three days as stocks and commodities rose after two German officials indicated a rolling back of resistance to a full sovereign bailout, raising investor appetite for riskier assets.
The rand swung between gains and losses before U.S. Federal Reserve policy makers end a two-day meeting amid speculation Chairman Ben S. Bernanke will continue stimulus that spurred fund flows into emerging economies.
Asian stocks advanced for a third day after Federal Reserve Chairman Ben S. Bernanke said the U.S. economic recovery will accelerate and the central bank has more means to prop up growth if appropriate.