The South African rand strengthened toward 16.2 per USD, supported by a softer dollar and firmer precious metals prices on the back of easing oil prices. Meanwhile, traders continued to monitor central bank actions. The Federal Reserve delivered an expected 25 bps rate hike and signalled that further tightening may follow amid persistent inflatonary pressures from the Middle East. Expectations for a SARB rate hike increased after the Fed's move, as a narrower yield differential could weigh on the rand and fuel inflationary pressures. The South African Reserve Bank will face a delicate balancing act when it decides on policy on September 23. Inflation has been rising and, aside from a brief dip in July following fuel-price cuts, remains on an upward trajectory. Meanwhile, the economy slipped back into contraction in the second quarter. At the same time, inflation expectations fell in Q3, signaling that price pressures are expected to ease over time.