The rand ploughed forward to test the 7.50 to the dollar level in early trade on Tuesday as global conditions and the high carry trade worked in the currency's favour.

By 08.43am the rand was bid at 7.5428 to the dollar from a previous close of 7.5120. It was bid at 11.7662 to the euro from a previous 11.7616 and at 14.9970 against sterling from 14.9399 before.

The euro was bid at $1.5590 from $1.5652 overnight, while gold was quoted at $889.70 a troy ounce from $892.60/oz overnight.

“The rand continues to strengthen sharply. The euro-rand made the running on Friday with a break of the 12.00 level, but we come into this morning's trade with USD/ZAR now also down,” say market analysts.

“Increasingly it seems that with the sharp Q1 sell-off and with the high and improving carry, the rand will continue to surge as long as international conditions remain positive,” they add.

The range for today has been penned in at 7.48 - 7.60 to the dollar by the analysts.

Bonds tentative ahead of Fed; eye rand

Bonds reflected their weaker bias in early trade on Tuesday as inflation concerns weighed and the strong rand failed to set the market on the front foot. According to analysts some caution is needed as the two-year and seven-year yield gap widens, but the rand strengthens.

By 08.56am the short-term government R153 bond was at 10.285 percent from its previous close of 10.250 percent, while the medium-term R157 was at 9.450 percent from 9.420 percent at its previous close. The longer-term R186 bond was bid at 9.275 percent from its previous close of 9.260 percent.

I-Net Bridge