JOHANNESBURG (Reuters) -The South African rand jumped over 1% on Tuesday against a weaker dollar on the back of improved risk sentiment and a drop in U.S. Treasury yields, analysts said.
At 1508 GMT, the rand traded at 19.0525 against the dollar, over 1.4% stronger than its previous close.
The dollar last traded 0.1% weaker against a basket of global currencies.
On Monday, the rand tumbled as violence in the Middle East stoked risk aversion on global markets.
The rand’s gains on Tuesday come on the back of dollar weakness, improved market sentiment which has been aided by a drop in U.S. Treasury yields at the beginning of the week and dovish comments from Federal Reserve officials on Monday, said Danny Greeff, co-head of Africa at ETM Analytics.
Markets are now less convinced about further monetary tightening required in the world’s biggest economy, Greeff added.
The rand like most emerging market currencies tends to take direction from global drivers such as U.S. monetary policy and dollar movement in addition to local economic data points.
Locally, census data from Statistics South Africa showed the country’s population grew to 62.0 million people last year from 51.8 million in 2011.
On the Johannesburg Stock Exchange, the blue-chip Top-40 index closed 3.26% higher, buoyed by mining companies.
South Africa’s benchmark 2030 government bond was stronger, with the yield down 14 basis points at 10.790%.
(Reporting by Alexander Winning and Tannur Anders; Editing by Andrew Heavens, Bhargav Acharya and Jonathan Oatis)