Johannesburg - South Africa's rand softened on Monday following a week of solid gains as the dollar bounced back ahead of a data-filled week locally and abroad.
By 06h40 the rand eased 0.4 percent to 11.8275 per dollar, having touched two-week highs as the greenback was weighed down by poor economic data suggesting the Federal Reserve would delay hiking rates.
The index measuring the dollar against major currencies showed the greenback 0.35 percent firmer as it recovered from three-month lows, finding some technical support after Friday's slide fuelled by weak a factory activity report.
South Africa publishes unemployment, inflation and retail figures in the week before the South African Reserve Bank announces its decision on interest rates on Thursday.
Economists polled by Reuters said the Reserve Bank would not raise interest rates until at least November, as it waits for inflation to reach its comfort level.
A weaker rand remained a worry for some economists, the poll also found, however inflation remains under the central bank's upper limit of 6 percent.
The rand has shed close to 3 percent versus the dollar in the past month, according to Thomson Reuters data, as fundamental weaknesses in the local economy and the spectre of a rate hike in the US weighed.
Power shortages were the biggest risk facing the economy, Finance Minister Nhlanhla Nene said on Monday at a press briefing, as state utility Eskom battles to meet demand and plug a R200 billion ($17 billion) funding gap.
Government bonds were mostly flat, with the benchmark instrument due in 2026 shedding half a basis point to 7.97 percent.
Reuters