The South African rand strengthened in early trade ahead of a central bank monetary policy review on Tuesday and local inflation figures the following day.
At 0723 GMT, the rand traded at 18.7100 against the dollar , over 0.3% firmer than its previous close.
The rand has had a strong start to the week, jumping over 1% on Monday as market sentiment improved, despite ongoing tensions in the Middle East.
The South African Reserve Bank will at around 1430 GMT release its October Monetary Policy Review, which is expected to shed light on Africa’s most industrialised economy.
The next major economic data release will be the monthly consumer inflation figures at 0800 GMT on Wednesday.
“A break below the 18.75 level could see the local currency push towards 18.65 and possibly 18.50, which will most likely depend on international developments,” said Andre Cilliers, currency strategist at TreasuryONE.
The rand, like most emerging market currencies, is highly sensitive to geopolitical tensions and U.S. monetary policy. Economic data releases in China also tend to affect the rand as China is South Africa’s biggest trading partner.
Shares on the Johannesburg Stock Exchange opened lower, with the blue-chip Top-40 index (.JTOPI) last trading down 0.7%.
South Africa’s benchmark 2030 government bond was slightly weaker in early deals, the yield up 1.5 basis points to 10.750%.
