The rand weakened against the dollar on speculation the central bank will keep buying foreign currencies after a report showed South Africa’s international reserves climbed the most in 11 months in February. South Africa’s currency weakened as much as 0.5 percent to 6.9132 per dollar, before trading 0.2 percent lower at 6.8903 rand by 9:45 a.m. in Johannesburg. Against the euro, the rand declined less than 0.1 percent to 9.6267. Gross reserves rose 4 percent to $47.3 billion in February from the previous month, while net reserves increased 0.7 percent to $44.8 billion, the Reserve Bank said on its website today. The Reserve Bank stepped up foreign currency purchases after the rand appreciated 11 percent against the dollar last year, reducing the competitiveness of South Africa’s exports. The increase in reserves was “strong,” analysts at Nedbank Group Ltd. wrote in an e-mailed note to clients. “The Reserve Bank is expected to continue to accumulate foreign reserves in order to reduce some of the upward pressure on the rand.” The rand has declined 4.9 percent against the dollar this year. “We do intervene in the markets in order to build our reserves, not to target the level of the exchange rate,” Reserve Bank Governor Gill Marcus said on Feb. 23. “We do not have a targeted reserve. We intervene as and when it is appropriate for us to do that.” South Africa’s benchmark 13.5 percent security due September 2015 rose was little changed, trading at 121.082 rand, with the yield at 7.86 percent. To contact the reporter on this story: Chris Kay in London at ckay5@bloomberg.net To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net.

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