At 0650 GMT, the rand traded at 17.5300 against the dollar, about 0.2% stronger than its previous close. The dollar slipped after less-hawkish-than-expected comments from Federal Reserve Chair Jerome Powell fuelled investor hopes that the central bank may soon ease monetary policy. With no domestic economic news on Wednesday, South African markets were in a lull ahead of the president's speech to parliament, where he is under pressure to offer some solution to address the nation's worsening power crisis.
Daily power cuts since last year have hammered economic growth in Africa's most industrialised nation and are proving a major test for the governing African National Congress, whose support among voters is sliding.
"There is much at stake, and as a result, the USD-ZAR will tread water ahead of the speech, adopting more meaningful direction after that," said ETM Analytics in a research note.
Investors are demanding some leadership, guidance and clarity on the steps being taken to extricate SA from the electricity generation crisis, the brokerage added. The government's benchmark 2030 bond was weaker in early deals, with the yield up 2.5 basis points at 9.785%. (Reporting by Nellie Peyton;Editing by Nivedita Bhattacharjee)
