The commodity-linked rand strengthened on Monday morning, touching R15.99/US$ thanks to record gold prices, while traders awaited the central bank’s first rate-setting meeting this year.
The rand briefly moved stronger than the R16 mark at 10.40am SAST. It then retreated slightly and was last quoted at 11.24am at R16.03/$. These are the currency’s strongest levels since June 2022, and should help drive down inflation, especially in imported goods, including software, computers, smartphones, IT equipment and consumer electronics generally.
While the greenback weakened slightly against a basket of currencies, gold surged to a record high above $5 000/ounce on Monday, extending an historic rally as investors piled into the safe-haven asset amid rising geopolitical uncertainties.
The risk-sensitive rand, which often tracks major global drivers such as US policy, has gained around 3% against the dollar since the start of 2026.
Investor attention will mainly be pinned on the South African Reserve Bank’s first interest rate meeting for 2026 on Thursday for clues on its monetary policy posture.
The Bank cut its main lending rate by 25 basis points in November saying that there was scope to make its policy stance less restrictive, in the context of an improved inflation outlook.
ETM Analytics said in a note that the local currency’s exposure to gold, platinum and other metals and commodities that have also moved inversely to the dollar could help it punch through the R16/$ level this week.
Rates
“[This will] give the Sarb something to think about as they deliberate whether there is enough room to cut rates so early in the year, despite the inflation rate remaining well above the 3% inflation target,” said the note.
Read: The rand just pulled off its biggest comeback in 16 years
South Africa’s benchmark 2035 government bond also strengthened in early deals, as the yield fell 7.5 basis points to 8.07%. — Sfundo Parakozov, (c) 2026 Reuters, with additional reporting (c) 2026 NewsCentral Media
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