South Africa’s rand gained early on Monday, as the dollar was dragged down by a steady rise of coronavirus infections in the United States.

At 0630 GMT, the rand was up 0.66% at 16.9425 per dollar after closing at 17.0500 on Friday.

Trading in the Asian session saw a return of risk appetite after last week’s narrow ranges, with demand growing for the rand and other emerging-market currencies.

Rising coronavirus infections in the United States have discouraged some investors from taking big positions in the currency market, but most remain focused on the growing likelihood that major economies will continue to recover.

“With the U.S. celebrating Independence Day, trading volumes dipped on Friday. Concerns surrounding rising infections – and renewed outbreaks after Fourth of July celebrations,” said analysts at NKC African Economics in a note.

“The rand surged stronger during Asian trading this morning driven by improved risk sentiment.”

Bonds rose, with the yield on the 2030 government issue down 2 basis points to 9.405%.

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