Johannesburg — South Africa’s rand was steady in early trade on Tuesday as investors awaited the release of central bank data expected to provide fresh insight into the outlook for Africa's most industrialised economy.
At 0632 GMT, the rand traded at 16.6525 against the U.S. dollar, little changed from its previous close.
The South African Reserve Bank was scheduled to release the country’s leading business cycle indicator for August at 0700 GMT. The indicator incorporates factors including vehicle sales, business confidence and money supply, offering a snapshot of economic activity.
Investors were also looking ahead to the U.S. Federal Reserve’s monetary policy decision on Wednesday, which could provide further guidance on the direction of global interest rates.
According to the CME FedWatch Tool, markets were pricing in an 11% probability of a rate hike this week and an 82% chance of an increase in December.
The rand, like other risk-sensitive currencies, is influenced by global market conditions, particularly U.S. monetary policy, as well as domestic economic developments.
South African government bonds were also steady in early trade, with the yield on the benchmark 2035 bond at 8.62%.
Market Outlook
Investors will be watching the leading indicator for signs of strength or weakness in South Africa's economic outlook, while the Federal Reserve’s decision could influence global risk appetite and emerging-market currencies.
Source: Reuters
Reporting: Nilutpal Timsina
Editing: Jochelle Mendonca.
