The rand was close to ten cents stronger versus the dollar on Monday as the euro gained close to a percent against the greenback. The weak dollar had the effect of pushing investors into the safe haven offered by gold, a move that leads to rand strength.

At 3.35pm the rand was bid at 7.4806 to the dollar from 7.5799 at its previous close. It was bid at 11.2055 to the euro from its previous close of 11.2498 and was at 12.4420 against sterling from 12.4950.

The euro was bid at US$1.4976 from US$1.4849 overnight.

Gold rallied to a fresh high of $1167 an ounce on Monday morning as risk appetite was given a fresh boost amid speculation an economic recovery in Asia was gathering pace.

A local dealer said that a break of 7.50 to the dollar was significant for the rand as it may signal a stronger down move to come.

"The rand has been very undecided and breaking 7.49/50 is crucial," he said.

Some traders said the dollar may have come under pressure on comments by Federal Reserve Bank of St Louis President James Bullard that he would prefer to keep the central bank's asset-buying programme active beyond its current cut-off date. In an interview with Dow Jones Newswires on Sunday, Bullard said he wants to see the central bank effort to buy mortgage-backed securities maintained beyond the end of the first quarter of 2010.

Barclays Capital analysts said Bullard's comments suggest "that the Fed will continue to underwrite the rally in risk and would leave the USD drowning in liquidity," while minutes of the Fed's policy meeting should also be supportive of further dollar weakness.

Local analysts will be looking to local GDP data for direction on Tuesday. It is a big piece of data that will reflect the larger size of the local economy.

GDP growth in South Africa is seen turning the corner at a rate of +0.7 percent quarter-on-quarter (q/q) seasonally adjusted annualised (saa) in the third quarter from the ?3.0 percent and ?6.4 percent in the second and first quarters, according to a poll of leading economists by I-Net Bridge.

The third quarter GDP last year was the 40th consecutive quarter of positive growth since 1998, but this came tumbling down in the fourth quarter as the first decline in a decade was registered.

The range of forecasts for the current survey was from ?0.6 percent q/q to +2.0 percent, with a feature being that seven of the eight economists surveyed saw a move out of negative territory. Two of them, though, penned in growth of 0.0 percent.

Statistics South Africa (Stats SA) will release the latest gross domestic product (GDP) growth figures on Tuesday at 11:30.