(Reuters) -The South African rand strengthened on Tuesday as the dollar deepened losses after a smaller-than-expected rise in U.S. producer prices provided further evidence that inflation may be cooling.
At 1611 GMT, the rand traded at 17.2450 against the dollar, 0.36% stronger than its closing level on Monday.
The dollar index, which tracks the U.S. currency against a basket of others, was down more than 0.6%.
The U.S. producer price index (PPI) increased 8.0% for the 12 months through October compared with economist expectations for an 8.3% rise and September’s 8.4% increase, according to Labor Department data.
On the Johannesburg Stock Exchange, the Top-40 index closed 0.36% higher, mirroring global markets.
The government’s benchmark 2030 bond was slightly stronger in afternoon deals, with the yield down 1 basis points at 10.245%.
(Reporting by Nellie Peyton and Anait MiridzhanianEditing by Angus MacSwan and Mark Potter)