The South African (SA) Rand held steady in early trade on Wednesday as markets stayed on edge over the latest United States (US) and Iran clashes and awaited crucial US inflation data for clues on the Federal Reserve’s rate path.
The Rand traded at 16.51 against the US Dollar, little changed from its previous close.
The Dollar held steady against its peers, while the oil prices climbed after the US military launched new strikes against Iran and as market data showed another large draw in US crude stocks.
The US military struck Iranian targets after President Donald Trump vowed on Tuesday to respond to the downing of an Apache attack helicopter, a fresh escalation that threatens to unravel a fragile ceasefire between Washington and Tehran.
Iran’s Revolutionary Guards said they retaliated with attacks against a US base in Jordan and 21 other targets in the Gulf on Wednesday.
“The local currency will continue to be driven by headlines and the US inflation data this afternoon,” Andre Cilliers, Currency Strategist at TreasuryONE, said.
A closely watched US inflation reading later in the day will be the next major test for markets. Like other risk-sensitive currencies, the Rand often takes cues from global drivers.
SA’s benchmark 2035 government bond was slightly weaker in early deals, as the yield rose 2.5 basis points to 8.65%.
–Reuters–
