The rand remained firm in noon trade on Monday, hovering below the 8.00 rand per dollar level amid increasing risk-taking.

At 11.45am the rand was bid at 7.9625 to the dollar from its overnight close of 8.0425. It was bid at 11.3395 to the euro from a previous 11.3535 and at 13.1513 against sterling from 13.1250.

The euro was bid at US$1.4242 from US$1.4116 overnight.

A local trader said: "We are seeing a bit of support at the 7.95 level as we see a return of risk appetite.

"Friday's earnings in the US continued to be above market expectations, while CIT looks like it will not go under.

"With very little data out later, we could see the rand trade at 7.90. Risk appetite is the flavour of the day for now," the trader said.

RMB analyst John Cairns said in his morning report that Gill Marcus's appointment, as the new SARB Governor should be seen as ZAR positive.

"She comes with all the right credentials, having served as Deputy Finance Minister, Deputy Governor at the SARB and within the private banking system. At her appointment President Zuma also reaffirmed the independence of the Bank and explicitly stated that he had not consulted with the ANC allies on the appointment. As with the appointment of Pravin Gordhan as Finance Minister there is no evidence of a shift to the left in economic policy," he said.

"We aren't aware of Marcus's views on the ZAR, but again believe that with the strong institutional set-up within the Bank that the reserve policy will remain unchanged. For now this implies moderate reserve accumulation under the USD/ZAR8.00 level," Cairns added.

He said rand volatility could be expected this week to come mainly in the late afternoon as we have a string of US events and data to follow. Key here will be Fed Chairman Bernanke's testimony to Congress on Tuesday and Wednesday.

Dow Jones Newswires reports that rising risk appetite sent the dollar and the yen reeling against high-yielders in Europe on Monday.

News that CIT Group will avoid bankruptcy and expectations of more good second-quarter earnings from the US this week appear to be feeding the positive sentiment.

Meanwhile, the pound got a lift of its own from Rightmove's report that UK house prices rose 0.6 percent this month.

The improved market sentiment had become well established late last week, with better-than-expected earnings from JPMorgan, IBM and Mattel as well as data showing that US housing starts rose more than forecast last month.

Although Japan was closed for a holiday, other Asian stock markets remained buoyant after the Dow Jones Industrial Average posted a 0.4 percent gain.

The flow of earnings data will only accelerate this week, with 140 results on the calendar, over 30 of which are financials.

Although some analysts feel there is room for disappointment, there is little sign that investors are stepping back at this stage.

The euro was one of the main beneficiaries of this new-found risk appetite, with the single currency breaking up through the top of its recent trading range at US$1.4200.

Conjecture Marcus could cut rates 2010

Bonds remained on the front foot by noon on Monday on the appointment of Gill Marcus as central bank governor elect. According to a well-placed source, there is some conjecture doing the rounds that the dovish Marcus could cut rates early next year.

By 11.52am the short-term government R153 bond was bid at 7.210 percent from a previous 7.245 percent. The medium-term R157 was at 8.530 percent from 8.570 percent, while the long-term R186 was bid at 9.040 percent from 9.070 percent before.

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