JOHANNESBURG (Reuters) -The South African rand was steady in early trade on Wednesday with investors keeping an eye on U.S. inflation reports due this week and key domestic releases that will offer clues on the health of Africa’s most industrialised economy.
At 0726 GMT, the rand traded at 17.5325 against the dollar, little changed from Tuesday’s close.
The dollar last traded flat against a basket of currencies as traders awaited U.S. producer price inflation data due on Wednesday followed by the consumer price inflation print on Thursday, which could help define the size and scope of interest rate cuts from the Federal Reserve for next week and beyond.
South Africa-focussed investors were little moved by better-than-expected GDP figures published on Tuesday, with analysts saying the below 1% growth was reflective of a subdued economy that continues to face many structural challenges.
The country’s statistics agency said South Africa’s economy grew 0.8% in the second quarter, slightly better than economists’ predictions for an expansion of 0.5% and the 0.1% reported in the first quarter.
Attention will shift to mining, manufacturing and current account data due on Thursday for further clues.
On the Johannesburg Stock Exchange, the Top-40 index was last up 0.3% in early trade.
“Stock markets are still doing well, and investor sentiment remains positive…and as a result, the rand will still perform reasonably well,” said ETM Analytics in a research note.
South Africa’s benchmark 2035 government bond was slightly weaker in early deals, as the yield rose one basis point to 9.495%.
(Reporting by Sfundo Parakozov;Editing by Frances Kerry)
