The South African (SA) Rand strengthened in early trade on Monday, as a softer Dollar ​helped offset fading hopes of a near-term ‌interest rate cut by the Unite States (US) Federal Reserve due to the elevated energy prices.

Rand traded at 16.89 against the Dollar, about ​0.3% up from its previous close.

The greenback ⁠nudged lower as stabilising oil prices encouraged traders ​to unwind positions that had been hedging against ​heightened risk aversion.

Gold prices, a key SA export, were steady on Monday after recovering from an earlier near 1% drop, ​supported by a softer Dollar.

“The Rand has ​always been sensitive to global risk appetite. Investors will be ‌forced ⁠to sell riskier, high-volatility investments to shore up their portfolios and trades potentially. For now, the Rand remains on the defensive, and that trading action ​is likely ​to extend ⁠through the week ahead,” said ETM Analytics in a research note.

On the Johannesburg ​Stock Exchange, the Top-40 index was ​last up ⁠0.7% in early trade.

SA’s benchmark 2035 government bond was weaker in early deals, as the ⁠yield ​rose 5 basis points to 8.98%.

–Reuters–