JOHANNESBURG: The rand held steady against the dollar, trading just below the psychologically key 10 rand area tested earlier in the session after the greenback was bolstered by strong US economic data.
The rand changed hands at 9.9890 at 0615 GMT, not far off its New York close on Tuesday, and recovering after breaching 10 rand earlier on Wednesday.
Better-than-expected retail sales data out of the United States on Tuesday added to expectations the Federal Reserve may start winding down stimulus by next month, likely reversing inflows that have helped to prop emerging markets.
The rand is likely to weaken further if South African retail sales data - due to be released later on Wednesday - fall short of market expectations.
Economists have forecast sales growth of 3 percent in June, which is due at 1100 GMT.
The last economic data for South Africa's second quarter, the retail sales number is likely to give clues on the outlook for second-quarter GDP after a lacklustre 0.9 percent growth rate in the preceding quarter.
"Considering the soft local growth environment and one which remains fraught with low productivity and the threat of more strike-related violence, particularly in the mining sector, the rand remains an obvious candidate whenever foreign investors are looking to reduce some of their exposure to emerging markets," Tradition Analytics wrote to clients.
The rand should find some support at the 10.0490 level, its previous low from Aug. 2. A breach of that may open up the 10.0800 region, however, traders expect some sideways trading before the market reaches for the key levels.
Yields on governments bonds were also steady, at 8.31 percent on the benchmark 2026 issue
The treasury will announce issuance plans for next week's weekly auction at 0900 GMT, while results of power utility Eskom's sale of EL30 and ES42 bonds is due after 0900 GMT.
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