S.AFRICA'S FINANCIAL RAND SEEN HEADED HIGHER
  The financial rand, widely viewed
  as a direct reflection of foreign investor confidence in South
  Africa, appears headed above 30 U.S. Cents, dealers and bank
  economists said.
      The currency has risen about 25 pct in the past three
  months to its current rate of 29.50 cents, due partly to signs
  of a possible power shift with the appearance of a number of
  independent candidates in the whites-only election on May 6,
  they added.
      It has risen about two cents this week alone.
      "Another factor is that banks in London, where the main
  market is based, are going long in the currency because of a
  general feeling that it will rise in the future," one economist
  said.
      Dealers described 30 cents as a psychological barrier that
  was expected to be broken soon after a brief consolidation
  phase from recent gains.
      After reaching 30 cents, "There is a chance of appreciation
  to 32 cents in the next several weeks," one dealer said.
      There was a widespread feeling that both the commercial
  rand, holding stable at 48 cents, and the financial rand were
  staying firm, banking sources said.
      A Barclays National Bank executive who asked not to be
  identified said: "The rise of the independents appears to be
  indicative of a potential shift of power in the National Party
  and has created a favourable sentiment overseas."
      One dealer said growing business and investor interest from
  West Germany and Switzerland were behind the financial rand's
  rise.
      Economists said foreigners also were being attracted by
  South Africa's long-term government bonds and "semi-gilts" or
  securities in partly government-owned firms, many with yields
  as high as 30 pct. They could be purchased with financial rands
  with interest paid in commercial rands.
      "This has had a definite influence on the financial form of
  the rand," a dealer said, adding that at present demand is
  slightly in excess of supply.
      The financial rand was reintroduced in September 1985 to
  help end capital flight from South Africa during a period of
  severe political unrest in the country.
  

