The rand was firm but range bound against major currencies in quiet noon trade on Monday as local markets settled back into business after a long weekend.

With UK markets being closed however owing to a bank holiday trade was quiet on the local front.

By 11.55am the rand was bid at 7.5835 to the dollar from a previous close of 7.5587. It was bid at 11.7422 to the euro from a previous 11.6679 and at 14.9348 against sterling from 14.9302 before.

The euro was bid at US$1.5475 from $1.5428 overnight, while gold was quoted at $864.95 a troy ounce from $856.20 overnight.

""The rand is very range bound at the moment. The London holiday has taken a lot of the liquidity out of the market," a local currency trader said.

ETM analysts said in their morning report that the dollar's recovery remains the order of the day with currency speculators responding to suggestions that the Fed funds rate may have bottomed.

Last week's better than expected non-farm payrolls figure has however offered the USD some support as have comments by Berkshire Hathaway Chairperson who indicated that the worst of the credit crisis may now be behind us.

With general levels of risk aversion subsiding, it does not come as much of a surprise to learn that equity markets have performed reasonably well through the course of the past two trading sessions.

"Against this backdrop, it is also not surprising to find the JPY firmly on the back foot having lost substantial ground in the past two trading sessions. With Japan on holiday for today and tomorrow, there is unlikely to be any change of the trend which continues to favour the carry trade boosting the prospects of higher yielding currencies such as the rand," they said.

For today, it will be difficult to ignore the public holiday in the UK which will also play a role in preventing any major move with trading in most currencies likely to be lethargic, they noted.

ETM expects the rand to trade in reasonably tight 7.50-60 range.

Profit taking helps the short end

Shorter-dated bonds received a shot in the arm during the morning on Monday as a few players looked to lock in some profits in that area of the market.

Investors have preferred a short bias due to the continuing inflation and interest rate concerns.

By 12.14pm the short-term government R153 bond was at 10.310 percent from its previous close of 10.340 percent, while the medium-term R157 was at 9.500 percent, unchanged from its previous close. The longer-term R186 bond was bid at 9.335 percent from its previous close of 9.330 percent.

I-Net Bridge