A slightly firmer rand tracked the euro in the afternoon session on Thursday, having earlier reacted negatively to rumours of government plans to freeze the unit.

The currency did not react to the South African Reserve Bank's (SARB's) Monetary Policy Committee decision to keep the repo rate unchanged at 7.0 percent.

At 3.46pm the rand was bid at 7.4718 to the dollar from 7.4100 at its previous close. It was bid at 11.2058 to the euro from its previous close of 11.1156 and was at 12.3860 against sterling from 12.2928.

The euro was bid at US$1.4991 from US$1.5007 overnight.

A local trader said: "We are unchanged and have seen very little action this afternoon. We are tracking the euro with an upside of 7.54 against the dollar, and bids at 7.46. We are just waiting to see which way we turn right now."

The rand was earlier spooked by news reports on economy minister Ebrahim Patel's plans to freeze the rand, but they were quickly quashed, according to a report by Bloomberg News, citing a spokesperson for Ebrahim Patel, Minister of Economic Development.

Dow Jones Newswire reports that the dollar was slightly stronger against the euro in morning New York trading on Thursday, as sagging global stocks sapped some of the risk appetite that sent the euro past US$1.50 a day earlier.

After falling to fresh 14-month lows against the euro on Wednesday, the dollar gained overnight on disappointing Chinese growth data, which bolstered the greenback's appeal.

The dollar's performance against the euro during the session will depend on the stock market: US stocks are set for a slightly lower open, and if US stocks follow the earlier downward path of Asian and European equities, the euro is likely to have trouble resuming its march past US$1.50.

Labour market data published on Thursday helped remind investors that the recovery remains fragile: US weekly jobless claims increased by 11 000 in the week ended 17 October; economists had expected a smaller increase of 4000.

Oil and other commodities also fell overnight, denting the euro and other higher-yielding currencies.

Bonds off worst, but sentiment weak

Bonds were off their worst levels of the day by the late afternoon on Thursday, but were 8.5 points weaker overall as sentiment remains weak.

The South African Reserve Bank's (SARB's) Monetary Policy Committee (MPC) on Thursday decided to keep the repo rate unchanged at 7.0 percent. This was in line with consensus expectations in the marketplace.

By 4.41pm the short-term government R154 bond was bid at 7.485 percent from a previous close of 7.345 percent. The medium-term R157 was at 8.655 percent from 8.570 percent, while the long-term R186 was at 9.280 percent from 9.190 percent.

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