The South African rand was muted in early trade on Thursday, as investors awaited key US inflation data that could influence the Federal Reserve's monetary policy path.

At 0705 GMT the rand traded at 16.05 against the dollar, little changed from its previous close of 16.0525.

January's Fed minutes showed that policymakers were in near-unanimous agreement to keep interest rates on hold, but remained split over their next steps, with "several" open to rate hikes if inflation remains elevated, others inclined to support further cuts if inflation recedes.

Markets currently expect the first interest rate cut this year to be in June.

Like other risk-sensitive currencies, the rand often takes cues from global drivers such as US policy in addition to local factors.

"The rand is largely unchanged from late yesterday, despite the firmer dollar, though the stronger greenback may keep some short-term pressure on the currency," said Wichard Cilliers, head of market risk at TreasuryONE in a research note.

Gold, a major South African export, was flat on Thursday as persisting geopolitical tensions between the US and Iran lifted safe-haven demand.

"Overall, currency and commodity markets remain cautious as they await clearer direction from upcoming US economic data," Cilliers said.

South Africa's benchmark 2035 government bond was also flat in early deals, with the yield at 7.955%.