The South African rand strengthened in early trade on Thursday after the United States and Iran released the text of an interim agreement signed by their presidents to end the war, easing geopolitical tensions and boosting risk appetite.

At 0614 GMT the rand traded at 16.3175 against the dollar, about 0.4% higher than its previous close.

The 14-point US-Iran agreement extends a ceasefire announced in April by another 60 days, including in Lebanon, to allow the two sides to negotiate a final truce.

Oil prices fell more than $1 per barrel on Thursday after the signing of the interim agreement that would end the Iran war, reopen the Strait of Hormuz and waive US sanctions on Tehran's oil, boosting the oil supply outlook.

"Looking ahead, given expectations that the Strait of Hormuz will reopen following the digital signing of a peace deal this week, the recent acceleration in headline inflation is expected to lose momentum, with fuel inflation moderating in July," ETM Analytics said in a research note.

On Wednesday, Statistics South Africa released May inflation data that showed slower-than-expected price growth, which analysts said reduced the likelihood of another central bank interest rate hike next month.

South Africa's benchmark 2035 government bond was flat in early deals, with the yield at 8.245%.