A range-bound rand tracked dollar/euro movement in the afternoon session on Tuesday.

At 3.40pm the rand was bid at 7.4364 to the dollar from 7.4100 at its previous close. It was bid at 11.1435 to the euro from its previous close of 11.1178 and was at 12.3970 against sterling from 12.4335.

The euro was bid at US$1.4985 from US$1.4999 overnight.

A local trader said: "The rand has tracked euro/dollar movement. Having run well of late, it tested 7.38-39 against the dollar, but is in a range of 7.40 to 7.46 against the dollar."

Dow Jones Newswires reported that Fitch's warning that the UK is the major economy most at risk from losing its AAA rating knocked the pound lower and helped the dollar to stage a small rally in Europe on Tuesday.

However, reaction is proving short-lived and the dollar looks set to decline again as investor appetite for riskier assets recovers.

Before the Fitch news, the dollar had been falling as investor confidence was buoyed by the assurance from G20 finance ministers at the weekend that they aren't in any hurry to exit their easy monetary policies.

The move into commodity and emerging market currencies were mostly made at the expense of the dollar.

Whether the euro will now be able to make a more sustained break over US$1.50 remains to be seen. Currency strategists at Commerzbank pointed to the lack of momentum to push the euro higher against the dollar.

Bonds see-saw on auction overhang

Bonds see-sawed between the red and black areas of the curve on Tuesday as offshore selling interest and an auction overhang outplayed any paying interest that was seen on the swaps.

By 3.57pm the short-term government R154 bond was bid at 7.010 percent from a previous close of 6.915 percent. The medium-term R157 was at 8.275 percent from 8.240 percent, while the long-term R186 was bid at 8.875 percent from 8.860 percent before.