And up again…

The rand raced to a fresh two-month peak yesterday, piercing the key technical level of R6,50 against the dollar, while more gains were seen on the back of a resurgent euro.

The local unit was trading at R6,4685 to the dollar, about 5c firmer on its New York close. It hit R6,40 tot he dollar earlier - its strongest level since May 20. This means that the rand has cut back its losses against the dollar this year to 12,5%.

Traders said more gains could be on the cards for the rand should the euro's rally stay intact. They are now testing R6,45 against the dollar and then R6,38 should be bottomish. It appears as though it is going to stay between R6,40-R6,60 against the dollar ahead of the monetary policy committee (MPC) next week.

The dollar fell for a third straight day yesterday in broadbased selling ignited by the euro's breakout from a four-week trading range to reach its highest level in two months.

The dollar also fell to a six-week low against the Swiss franc and a three week trough against sterling as traders focused on technical levels.

The euro had tried and failed to break through $1,2250-60 earlier this week, but finally managed it yesterday, rising 1,1% to $1,2332. The dollar was down 1,2% at Sf 1,2611 and sterling was up 0,3% at $1,7769.

It was the third day of declines for the dollar against the euro, yen and Swiss franc , while sterling gained against the greenback for a sixth consecutive day.