The rand strengthened in cautious trade on Friday as investor focus shifted towards US president-elect Donald Trump's inauguration on Monday.

At 10.08am, the rand traded at 18.755 against the dollar, about 0.4% stronger than its previous close.

“Trump's policies and US Treasury movements will dominate sentiment in the short-term, with limited market activity expected until after his inauguration,” said Andre Cilliers, currency strategist at TreasuryONE.

A sturdy labour market, sticky inflation and uncertainty over the potential impact of Trump's tariffs and tax plans have led the US Federal Reserve to project two interest rate cuts this year.

However, Fed governor Christopher Waller said on Thursday three or four rate cuts are still possible if economic data weakens further.

On the stock market, South Africa's Top-40 index was up about 0.6%.

Its benchmark 2030 government bond also strengthened, with the yield down 5.5 basis points to 9.15%.