JOHANNESBURG (Reuters) -The South African rand weakened against a stronger dollar on Tuesday as investors turned their attention to the Federal Reserve’s interest rate decision.
At 1502 GMT, the rand was trading at 18.16 against the dollar, about 1.7% weaker than its previous close.
The rate last rose about 0.12% against a basket of currencies.
The Fed will announce its interest rate decision on Wednesday, with markets expecting a 25 basis point cut, but the focus will also be on the central bank’s tone on rates for the coming year.
“A conservative tone is likely to support the USD and put pressure on emerging market currencies, including the ZAR,” said Andre Cilliers, currency strategist at TreasuryONE.
Earlier in the day, central bank data showed South Africa’s composite key economic indicator rose 1.1% month-on-month in October.
On the stock market, the Top-40 index closed about 1.6% lower.
South Africa’s 2030 government bond was weaker, with yields rising 7.5 basis points to 8.995%.
