The rand was weaker in early trade on Wednesday ahead of South Africa’s mid-term budget statement and the US Federal Reserve’s interest rate decision later in the day.
At 0727 GMT, the rand traded at R18.73 against the dollar.
The dollar last traded around 0.04% weaker against a basket of global currencies.
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Finance Minister Enoch Godongwana will at 1200 GMT present to parliament the Medium-Term Budget Policy Statement (MTBPS), which updates economic forecasts, adjusts the budget and make emergency changes to spending.
“Investors will be watching Godongwana’s MTBPS address closely today to see how he juggles declining revenue against expenditure and what the country’s debt-to-GDP is projected to be,” said Andre Cilliers, currency strategist at TreasuryONE.
The rand has been surprisingly resilient in the run-up to the MTBPS, he added in a note.
South Africa will need to curb expenditure and see higher revenues for the rest of the year to achieve its fiscal estimates, said Investec chief economist Annabel Bishop.
“Markets are wary that in a low growth environment with high, and rising, bond yields this becomes more difficult,” Bishop said.
Global markets will look to the Fed’s interest rate decision later in the day for guidance on the world’s biggest economy.
On the Johannesburg Stock Exchange, the blue-chip Top 40 index traded around 0.36% weaker early in the day.
South Africa’s benchmark 2030 government bond was weaker in early deals, with the yield up 3.5 basis points to 10.710%.