Rand holds near multi-month high as Iran sanctions loom

The South African rand opened the week on a firm footing on Monday, hovering near its strongest ​level since the start of the Iran war, as a ‌subdued dollar, higher gold prices and strength across emerging-market currencies supported the commodity-linked currency.

At 06:36 GMT, the rand traded at 15.99 against ​the dollar, up about 0.2% and not far from ​its strongest level since the start of the Iran ⁠war, touched earlier in the session.

South Africa’s key export, ​gold, hit its highest level in more than three months as ​a subdued dollar lent support, while investors looked ahead to key US inflation data and a speech by Federal Reserve Chair Kevin Warsh later ​this week.

The dollar was pinned near multi-month lows as traders ​awaited details of a fresh US sanctions package against Iran .

US Treasury Secretary ‌Scott ⁠Bessent is due to hold a press conference at 1800 GMT after threatening “the toughest sanctions in history” on Iran, while Iran’s foreign minister dismissed the threat of new US sanctions as ​a sign of ​desperation.

Wichard Cilliers, ⁠head of market risk at TreasuryONE, said the rand’s rally was being driven by broad dollar ​weakness, strong emerging-market sentiment and higher gold ​prices.

Like other ⁠risk-sensitive currencies, the rand has been at the mercy of global market sentiment, particularly since the start of the US-Iran ⁠war on ​February 28.

South Africa’s benchmark 2035 government ​bond was slightly firmer in early deals, as the yield fell 1.5 basis ​points to 8.565%.