The rand strengthened on Wednesday, supported by improved risk sentiment in global markets following hawkish comments from the US Federal Reserve, while investors awaited domestic consumer price inflation data.
At 8.35am, the rand was around 0.3 percent stronger 14.8000 to the dollar, hovering close to five-month highs scaled in the previous session on expectations that the central bank would raise interest rates on Thursday.
“Markets turned more positive on riskier assets yesterday, and high commodity prices drove developments. The rand and other commodity driven currencies relished the opportunity to make further gains,” said Citadel Global director Bianca Botes.
Lifting appetite across markets, Federal Reserve chairperson Jerome Powell said the US central bank could move “more aggressively” to raise rates to fight inflation, possibly hiking them by more than 25 basis points at one or more meetings this year.
Statistics South Africa will publish February consumer price inflation numbers on Wednesday which are expected to show CPI quickened to 5.8 percent year-on-year.
On Thursday, the South African Reserve Bank is expected to hike its repo rate to 4.25 percent to try to tackle inflation, according to a Reuters poll of economists.
In fixed income, the yield on the benchmark 2030 government bond was up 3 basis points to 9.815 percent.
REUTERS