The South African rand strengthened to below 18 per USD, driven by a weakening dollar after dovish signals from the Federal Reserve reinforced expectations of interest rate cuts. Gains were also driven by rising metal prices, which boosted sentiment toward commodity-linked currencies. Nonetheless, geopolitical instability in the Middle East continues to fuel inflationary concerns, which could pressure South Africa’s broader economic outlook. The South African Reserve Bank, in its latest biannual Financial Stability Review published on June 19, noted that growing geopolitical upheaval and global policy uncertainty are among the biggest risks facing the country's financial sector. However, Governor Lesetja Kganyago said South Africa's financial system was so far demonstrating a high degree of resilience in response to global shocks.