South Africa's rand weakened in early trade on Thursday as the risk-on environment that has supported emerging market currencies in recent days started to fade ahead of the release of Federal Reserve minutes from the September meeting.
On the equities market, stocks opened softer with the benchmark JSE Top-40 index shedding 0.31 percent to 47,009 points.
By 0709 GMT the rand was trading at 13.4775 per dollar, down 0.02 percent from Wednesday's New York close.
"While the setup on the charts pointed to a raging ‘sell’ yesterday, traders will walk in this morning a little more circumspect," Standard Bank currency trader Inshaan Omar said in a market note.
Later in the session, the Fed will release the minutes of its September meeting. Investors will be scrutinising the text for clues on whether the Fed will implement the first interest rate increase since 2006 later this year or wait until 2016.
Some analysts said while the market relaxed after the September meeting, market futures' pricing of Fed hikes is coming back.
"Although Fed rate hike concerns declined after the September FOMC, we note that these concerns have begun to tick higher once again this month, hence, we believe this provides scope for the recent ZAR short-covering to come to a grinding halt," said Peter Worthington an economist at Barclays Africa.
Government bonds were mixed after a sell-off on Wednesday afternoon with the benchmark 2026 issue adding 4.5 basis points to 8.220 percent.
"Most of the buying continues to be concentrated in shorter-dated bonds," said Gordon Kerr fixed income trader at Rand Bank Merchant.