The rand continued to track euro/dollar play in the afternoon session on Monday amid very little action as markets looked to take a breather.

At 3.42pm the rand was bid at 7.7677 to the dollar from 7.7466 at its previous close. It was bid at 10.6199 to the euro from its previous close of 10.5847 and was at 12.1035 against the sterling from 12.0951.

The euro was bid at US$1.3669 from US$1.3642 previously.

A local currency trader said: "We haven't seen to much action this afternoon, tracking the euro/dollar. Markets appear to be taking a breather after last week, which saw the dollar run hard. There seems to be more stability today as we reached some crucial levels.

"The range is at 7.70-7.80 against the dollar, but if we see a close above that level overnight, we could see further moves to the topside," the trader said.

Dow Jones Newswire reported that a small recovery in risk appetite pushed the dollar lower in places in Europe Monday.

The euro is the main beneficiary as a lack of any fresh bad news on Greece has encouraged a small fall in the price of the country's credit default swaps.

However, the debt problems of Greece, as well as those of Spain and Portugal, are expected to remain a dominant feature in currency markets.

Last Friday's vote by Portugal to extend the spending powers of its regional councils aren't going to help either as this will make it more difficult for Lisbon to curb the country's budget deficit.

Meanwhile, finance ministers from the Group of Seven industrialized economies who met in Canada last weekend disappointed hopes of some new initiative for resolving the problem of large budget deficits in peripheral euro-zone countries.

Instead, nothing new was said on the matter. European officials once again suggested that a bail-out is not on the European Union's agenda.

Coming after last Friday's surprisingly sharp upward revision to unemployment in the US last year, the lack of news out of the G-7 meeting only helped to undermine sentiment even further, leaving stocks in Asian markets mostly lower.

Bonds unchanged from Friday levels

Despite a softer rand, South African bonds were practically unchanged from their previous levels in late trade on Monday in the absence of any real market moving news.

By 3.50pm the short-term government R154 bond was bid at 7.225 percent and offered at 7.205 percent after closing at 7.220 percent on Friday and the medium-term R157 was at 8.360 percent after closing at 8.365 percent previously. The long-term R186 was bid at 9.120 percent and offered at 9.090 percent from 9.115 percent previously.