Rand little changed at open, tracking dollar

South Africa’s rand was little changed early on Thursday, tracking the dollar which lolled below an 11-week high amid conflicting signals from the US Federal Reserve.

At 0718 GMT, the rand traded at 14.22 against the dollar, less than 0.1% stronger than its previous close.

“The rand remains range-bound as we open this morning in line with yesterday’s close,” said Andre Cilliers, a currency strategist at TreasuryONE. “For now, we can expect the rand to mostly track the dollar.”

The US currency got some support overnight as two Fed officials said a period of high inflation in the United States could last longer than anticipated, a day after Fed Chair Jerome Powell had played down rising price pressures. But it was a touch weaker on Thursday against a basket of major currencies .

Statistics South Africa will release producer price index figures around 0930 GMT, giving further clues about inflationary pressures in Africa’s most industrialised economy.

Data on Wednesday showed consumer inflation hit a 30-month high in May, but economists are not predicting the South African Reserve Bank will raise interest rates any time soon.

Read: Inflation hits 5.2%

South African government bonds were also barely changed early on Thursday, as the yield on the benchmark 2030 instrument rose 0.5 basis points to 8.955%.