JOHANNESBURG: South Africa's rand surrendered early gains against the dollar on Thursday amid uncertainty about the timing of a U.S. interest rate hike.
By 0639 GMT the rand had slipped 0.11 percent to 11.4575 against the greenback, after initially rallying to its firmest in four weeks following better-than-expected local retail sales numbers.
A sharp decline in fourth-quarter consumer spending in the U.S. also boosted the local unit as the dollar stumbled, although the respite was short lived.
The weak U.S. data led some market participants to adjust their forecasts of when the U.S. Federal Reserve would being lifting lending rates, prompting divergent investment flows as risk sentiment improved slightly.
"Given the poor U.S. retail sales data the market is still fiercely undecided on the course of action the Fed is going to follow this year," analyst Warrick Butler of Standard Bank said in a morning note.
Yields on government bonds edged up, the benchmark issue due in 2026 adding 1.5 points to 7.495 percent in early trade.
With no local data scheduled on Thursday analysts expect direction to come from offshore data releases, with U.S. publishing its December producer price index later in the session.
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