Rand Weakens Against Major Currencies as US Dollar Index Hits 100

The South African rand weakened against major currencies in the foreign exchange market on Tuesday as global dynamics favored the US dollar.

The dollar index hovered near 100 after rebounding in the previous session, with investors reassessing their expectations for Federal Reserve monetary policy amid ongoing uncertainty in the Middle East.

Markets are currently pricing in a 65% chance of a 25 basis point Fed rate hike in September, following the central bank's decision to leave interest rates unchanged in July.

The rand is slightly weaker due to stronger-than-expected US manufacturing data supporting the dollar and reducing expectations of near-term interest rate cuts, according to First National Bank's stockbroking and portfolio management subsidiary.