South Africa's rand was subdued in early trade on Friday as traders awaited an inflation reading due next week for fresh signals on the health of Africa's most industrialised economy and clues on the central bank's rate-cutting path this year.

At 0823 GMT the rand traded at 16.3775 against the dollar, down roughly 0.2% from Thursday's close as markets cautiously waited for December consumer inflation figures.

Inflation slowed for the first time in three months in November to 3.5%, staying within the 1 percentage point tolerance band of the 3% target.

At its last meeting, South Africa's central bank cut its main lending rate by 25 basis points to 6.75% in a unanimous decision, saying there was scope to make the policy stance less restrictive, in the context of an improved inflation outlook.

The dollar last traded flat against a basket of currencies, with global investors still closely tracking US President Donald Trump's posture on Iran and the Federal Reserve Chair Jerome Powell.

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

People inside Iran, reached by Reuters on Wednesday and Thursday, said protests appeared to have abated since Monday while Trump also struck a softer tone regarding possible military intervention against the Islamic Republic.

His tone on Powell also seemed measured, saying he had no plans to fire him despite the Justice Department's criminal investigation against him over a building renovation project at Fed headquarters, though adding it was "too early" to say what he would ultimately do.

On the Johannesburg Stock Exchange, the Top-40 index was last down 0.1% in early trade.

South Africa's benchmark 2035 government bond was weaker, as the yield rose 3.5 basis points to 8.32%.