JOHANNESBURG, Sept 17 (Reuters) - The South African rand

held steady on Tuesday, with investor focus on Wednesday's U.S.

Federal Reserve policy decision which could see it deliver a big

interest rate cut.

At 1501 GMT, the rand traded at 17.635 against the dollar

, not far from its Monday closing level of 17.6225.

Markets are certain the Fed will cut rates when it makes its

policy announcement on Wednesday and are leaning towards more

aggressive easing in the world's biggest economy.

"Markets have started positioning themselves for a 50bps

(basis points) rate cut by the Fed," said Andre Cilliers,

currency strategist at TreasuryONE.

Like other risk-sensitive currencies, the rand often takes

cues from global drivers like U.S. monetary policy in addition

to domestic factors.

On Wednesday, local investors will look to South Africa's

August consumer inflation figures and on Thursday,

the South African Reserve Bank will announce its policy decision

.

Economists polled by Reuters predict a 25-basis-point rate

cut by the central bank of Africa's most industrialised economy.

On the stock market, the Top-40 index closed 1.2%

higher.

South Africa's benchmark 2030 government bond was

weaker, as the yield rose 3 basis points to 8.855%.