The rand was little changed in early trade on Friday as it shrugged off hawkish comments by the US Federal Reserve Chair, which led some investors to believe interest rate hikes have not peaked in the world’s biggest economy.
At 0719 GMT, the rand traded at R18.67 against the dollar.
The dollar last traded around 0.01% stronger against a basket of global currencies.
ADVERTISEMENT
CONTINUE READING BELOW
On Thursday, Fed Chair Jerome Powell said that further interest rate hikes may be needed to bring inflation within the US central bank’s target range.
The rand jumped last week as risk sentiment improved after the Federal Reserve left interest rates unchanged.
“Fresh data releases over the next few weeks will be critical to what the Fed will likely do at its next FOMC meeting,” said Andre Cilliers, currency strategist at TreasuryONE.
Like other risk-sensitive currencies, the rand often takes cues from global factors, such as US monetary policy, in the absence of local drivers.
On the Johannesburg Stock Exchange, the blue-chip Top 40 index was about 0.8% down in early trade.
South Africa’s benchmark 2030 government bond was weaker in early deals, with the yield up 6.5 basis points to 10.405%.
