The rand was firmer against major currencies in late trade on Thursday which analysts attributed to the carry trade starting to kick in.

An analyst said that if the rand were to remain below the 7.80 rand per dollar level, the currency could be in for a period of further recovery.

By 3.45pm the rand was bid at 7.7589 to the dollar from a previous close of 7.8391. It was bid at 12.2225 to the euro from a previous 12.4526 and at 15.3823 against sterling from 15.6329 before.

The euro was bid at US$1.5748 from US$1.5890 overnight, while gold was quoted at $933.90 a troy ounce from $944.85 overnight.

"It's difficult to say why the rand has firmed but it's likely that it's the carry trade starting to kick in to the rand. If the rand can effectively break below the 7.80 rand per dollar level, we could be in for a period of further rand recovery," a local analyst said.

"The ECB was a little less hawkish this afternoon than expected. And the US jobs data that come out this afternoon shows that it is not looking too good going forward, so neither banks (the ECB or the US Fed) are likely to raise rates again in the near future," he said.

"In this environment it will make the rand look a little bit more attractive going ahead," he added.

Dow Jones Newswires reports that the dollar rose against the euro on Thursday in New York trading after US jobs data came in weak but near forecasts and the head of the European Central Bank cited downside risks to euro zone economic growth.

Nonfarm payrolls fell 62 000, the Labour Department said on Thursday, which was very close to expectations of a 55 000 decline. "The data shows the ongoing weakness, but nothing out of the ordinary," said Win Thin, currency strategist at Brown Brothers Harriman.

While the benign US employment report gave the dollar a modest boost, it was less-hawkish-than-expected comments from ECB President Jean-Claude Trichet that unleashed the dollar, pulling the euro below $1.5800 to as low as $1.5742.

Earlier Thursday, the ECB hiked rates by 25 basis points in an effort to stem rising inflation. Analysts thought Trichet, in a press conference after the rate announcement, might suggest more rate hikes could be forthcoming.

But the ECB chief said he would not pre-commit to any future rate moves, adding that while inflation remains a worry, there are downside risks to economic growth.

"The latest data confirm the expected weakening of real (economic) growth in mid-2008 after exceptionally strong growth in the first quarter," Trichet said.

Analysts said this indicates that more rate hikes in the near term are perhaps unlikely.

Bonds extend gains on firm rand

Bonds extended their gains on Thursday and were between 12.5 to 15 basis points firmer in late afternoon as the rand broke below the 7.80 per dollar level.

By 3.45pm the short-term government R153 bond was at 11.660 percent from its previous close of 11.780 percent, while the medium-term R157 was at 10.620 percent from a previous 10.760 percent. The long-term R186 was bid at 10.365 percent from a previous 10.515 percent.

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