The rand remained weaker in the afternoon session on Thursday testing technical level of 7.47 against the greenback, however the local currency was expected remain within a range for the remainder of the day amid Thanksgiving holiday in the US.

The rand had earlier lost its firm footing by amid rumours of a threat of a debt default by Dubai World, amid concerns that investors could get jittery and take risk off the table.

Government-owned investment company Dubai World, which has almost $60-billion worth of liabilities, asked creditors to postpone its forthcoming payments for six months.

At 3.37pm the rand was bid at 7.4582 to the dollar from 7.3200 at its previous close. It was bid at 11.2348 to the euro from its previous close of 11.0766 and was at 12.3287 against sterling from 12.2275.

The euro was bid at US$1.5062 from US$1.5135 overnight.

A local trader said: "We are on US time, which is expected to be dead, amid the holiday (Thanksgiving) there. We did see the rand retrace today, with continued rand weakness after the local currency hit a few technical levels particularly 7.34 against the dollar yesterday. The bounce comes having seen the rand strengthen over the past few day, however we are still with in medium-term range.

"If we test 7.47 we may see further weakness," the trader said.

Earlier, Dow Jones Newswires said that fear of a debt default by Dubai World, along with talk of intervention by the Bank of Japan and suspected intervention by the Swiss National Bank, helped to lift the dollar in Europe on Thursday.

This was a reversal of the US currency's recent sharp slide which took it down to a 14-year low against the yen during Asian trading as investors continued to worry about how long US interest rates will have stay at low levels.

The dollar was also driven lower by reports that Russia is planning to diversify some of its foreign exchange reserves into the Canadian dollar.

However, there was a sharp shift in global sentiment as news broke that Dubai World, a holding company for the Dubai government, shocked financial markets with a request for a delay in repayment on about $35-billion of its debt.

With the Thanksgiving holiday in the US, turnover in currency markets is expected to remain fairly low, with the dollar likely to trade in narrow ranges from here.

Bonds head weaker in line with rand

Bonds weakened by eight basis points on Thursday in line with a retreating rand.

By 4.18pm the short-term government R154 bond was bid at 7.350 percent from a previous close of 7.220 percent. The medium-term R157 was at 8.470 percent from 8.360 percent at its previous close, while the long-term R186 was at 9.170 percent from 9.065 percent before.

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