JOHANNESBURG, Jan 14 (Reuters) – The South African rand was lifted by record high gold prices in early trade on Wednesday, while global markets continued to assess key U.S inflation indicators which could offer more clues on the Federal Reserve’s interest rate trajectory.
At 0805 GMT the rand traded at 16.3525 against the dollar , up roughly 0.2% on Tuesday’s close.
Sign up here.
Gold, a major South African export, climbed on Wednesday to a record, while silver breached the $90 mark for the first time.The U.S. dollar last traded flat against a basket of currencies as traders analysed softer-than-expected U.S. inflation readings while awaiting core Producer Price Index data for December due later in the day.
“The Fed is widely expected to pause on any further interest rate hikes, despite pressure from Trump to lower rates,” said Andre Cilliers, currency strategist at TreasuryONE.
He added that the rand would remain in a tight range, as it takes cues from global developments such as the unrest in Iran, concerns over the Fed’s independence and a potential extension of the U.S. trade preference programme, the African Growth and Opportunity Act.
On the Johannesburg Stock Exchange, the Top-40 index (.JTOPI), opens new tab was last up 0.4% in early trade.
South Africa’s benchmark 2035 government bond also gained, with the yield falling 3 basis points to 8.28%.
Reporting by Sfundo Parakozov;
Editing by Alex Richardson
Our Standards: The Thomson Reuters Trust Principles., opens new tab