At 1602 GMT, the rand traded at 15.9650 against the dollar, roughly 0.8% weaker than its previous close and erasing gains on Monday, the first trading day of 2022.
Investors have come to view Omicron as potentially less disruptive to the global economy than previous variants, and market attention is now firmly pinned on when the Fed will start raising rates from their pandemic-era low.
With the South African economic data calendar relatively light this week, with a purchasing managers' survey due on Wednesday and reserves figures on Friday, the rand is likely to continue to track global drivers.
The Johannesburg Stock Exchange woke up on Tuesday after a muted start to 2022 a day earlier, as investors hunted for returns.
The All-share index ended up 1.8% at 75,052 points and the blue-chip top 40 companies index closed up 2.05% at 68,399 points - mirroring gains made on Wall Street.
The local rally was mostly driven by financial stocks and a 2.5% gain in index heavyweight Naspers, which lagged the broader market last year. Some analysts still consider South African stocks cheaper than peers despite an almost 25% gain in 2021.
(Reporting by Promit Mukherjee and Alexander Winning; Editing by Alex Richardson)
