JOHANNESBURG: The South African rand strengthened against a weaker dollar early on Friday after US Treasury yields lost some steam and traders turned their attention to a slew of local data points, including trade and budget figures.

At 0634 GMT, the rand traded at 18.8950 against the dollar, about 0.5% stronger than its previous close. The dollar last traded around 0.2% weaker against a basket of global currencies.

“The rise in US rates has finally run out of steam. Some dovish Fed speak yesterday saw yields ease off 15+ year highs,” said Rand Merchant Bank analysts in a research note.

“Whether this is a change in direction or just a pause remains to be seen. But global markets sigh with relief.” Like other risk-sensitive currencies, the rand often takes cues from global factors like US monetary policy.

South African rand flat ahead of producer price data

On Friday, local investors will focus on August money supply and private sector credit growth, trade and budget balance figures for fresh direction.

South Africa’s benchmark 2030 government bond was stronger in early deals, with the yield down 8 basis points to 10.960%.