Rand Retraces Yesterday's Gains, Implied Vol Rises Ahead Of Fed Rate Decision

USD/ZAR has ticked higher amid pre-Fed caution, with domestic headline flow offering little to move the rand. The rate has added more than 1,700 pips and now changes hands at 17.7195, with bulls looking for a return above the 18.00 figure. Bears keep an eye on 17.4562, the 76.4% retracement of the Jan - Jun bull leg.

• USD/ZAR overnight implied volatility jumped to its highest level since June 1 and after paring initial gains sits at 24.8%. Participants will pay close attention to the Fed monetary policy decision tonight after the SARB delivered a "hawkish hold" last week, wrongfooting consensus leaning slightly towards a 25bp hike.
• South Arica asked the US to consider an early extension of the African Growth and Opportunity Act (AGOA) beyond the 2025 expiry date. The plea came after a bipartisan group of US lawmakers asked the White House to reconsider South Africa's AGOA status over the country's foreign policies.
• SAGB yields are slightly higher at typing, with 10-year breakeven inflation rate sitting at 6.43%. The composite BBG Commodity Index sits ~0.4% lower on the day, but the precious metals subindex operates ~0.4% higher.