South Africa's rand traded weaker on Monday as risk appetite waned amid geopolitical tensions and as traders looked ahead to domestic inflation data due this week for clues on the central bank's rate-cutting path later this year.

At 0755 GMT the rand traded at 16.4750 against the dollar, about 0.5% down from its previous close.

ETM Analytics said that risk appetite might be in shorter supply at the start of the week after President Donald Trump threatened a wave of increasing trade tariffs on key European allies till the US is allowed to buy Greenland.

"For the ZAR, this will leave the local unit on the defensive this morning. That sentiment may further compound in the trading sessions ahead, depending on the nature of negotiations and rhetoric between the US and the EU over Greenland," ETM Analytics said in a research note.

Like other risk-sensitive currencies, the rand often takes its cue from global drivers such as US policy.

Domestically-focused traders will examine consumer inflation data on Wednesday, which has major relevance for monetary policy but also holds implications for South Africa's financial markets.

"Consensus estimates have the inflation rate rising marginally to 3.6%, although the downside risk to this data is high. With the ZAR having performed well in recent months, it is likely the market has underestimated the ZAR's impact," ETM Analytics said.

On the Johannesburg Stock Exchange, the Top-40 index was down 0.2% in early trade.

South Africa's benchmark 2035 government bond was also weaker in early deals, as the yield rose 9.5 basis points to 8.44%.