JOHANNESBURG: The South African rand edged up in early trade on Wednesday, as investors awaited domestic inflation data and the US Federal Reserve policy meeting outcome.
At 0615 GMT, the rand traded at 16.0800 against the dollar, 0.12% firmer than its previous close.
"The foreign exchange markets are likely to trade cautiously and erratically as they await the outcome of the Fed meeting this evening," analysts at Nedbank said in a note.
Traders are watching the Fed to see whether it accelerates tapering of its bond buying programme and brings forward its projections for interest rate rises.
US interest rate hikes tend to drain capital away from higher-yielding but riskier emerging markets including South Africa, weighing on their currencies.
On the local front, several domestic data releases are set for Wednesday, including the November consumer price index , producer inflation and a leading business cycle indicator.
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