The rand steadied in early trade on Monday, but looked vulnerable to risk aversion before the US Federal Reserve’s monetary policy meeting this week and a referendum of Britain’s potential exit from the European Union next week.
At 08:45, the rand traded at R15.2350/$, not far off its New York close of R15.2420/$ on Friday.
“Dollar strength and risk aversion threaten the rand,” Rand Merchant Bank analyst John Cairns said in a note.
“Event risk is focused on Tuesday’s (South Africa) current account data and Wednesday’s Fed meeting but it will probably be sentiment, particularly towards the dollar, that drives markets this week.”
The central banks of the United States, Japan, Britain and Switzerland all hold policy setting meetings this week, but investors expect them to stand pat given uncertainty over the looming UK referendum.
Stocks were set to open lower at 09:00, with the JSE’s Top 40 futures index down 0.93%.
In fixed income, the yield for the benchmark instrument due in 2026 added 8.5 basis points to 9.155%.