The rand was stable in the Monday morning trade, with analysts expecting little movement of the local currency until the outcome of the European Central Bank (ECB) meeting later this week.
The ECB is meeting on Thursday in Barcelona and media reports said it may refuse any more easy money for governments as the political resolve to rein in deficits shows signs of crumbling in that region.
Since the ECB's last meeting in April, there has been a resurgence in the eurozone sovereign debt crisis, and the spotlight on the 17-nation bloc suggests it has fallen into recession.
"The rand is very stable this morning and we are not expecting much influence until the outcome of the ECB. It strengthened in thin volume by 0.7 percent to R7.73 against the USD on Friday, which was good," a local trader said.
SA markets were closed on Friday for the Freedom Day public holiday.
At 08:37 local time the rand was bid at R7.7347 to the dollar from its previous close of R7.7.7340. It was bid at R10.2485 to the euro from R10.2559 before, and at R12.5848 against sterling from R12.6011 previously.
The euro was bid at US$1.3248 from its previous close of $1.3239.
Standard Bank analysts said in a morning report that the rand had remained fairly range-bound over the past week, as the market firstly waited for the FOMC meeting and then the local public holiday.
"Weaker-than-expected US Q1:12 GDP numbers late last week have put the dollar under pressure, with the rand benefitting from this weakness. Over the coming week, however, the rand could suffer if developments in Europe continue to take a negative tone. The downgrading of Spain's sovereign rating will make this week's Spanish auction a key focal point," the bank said.
Standard bank said it didn't expect fresh stimulus measures from the ECB meeting, which could weigh on the euro.
"While the odds remain stacked in favour of rand weakness in our view, today's data could provide some support if the trade balance narrows in line with our expectations," the bank added.
Dow Jones Newswires reported that the dollar sagged against the yen and emerging Asian currencies on Monday as more signs of strain on the US economy spurred expectations of further easing by the Fed.
Some of the optimism on the US economy that contributed to the greenback's turnaround against the yen this year appears to be wearing off, while the Bank of Japan's announcement on Friday of further easing did virtually nothing to slow the yen's ascent.
"Our view is that over the last few months, Bank of Japan easing has had only a marginal impact," said Robert Ryan, G-10 currency strategist at BNP Paribas. "If the dollar were to move back toward Y77 or Y76, it would call into question the whole rationale for the BOJ to ease further."
Bonds tad firmer on good PSCE, M3 data
Bonds were marginally firmer in opening trade on Monday gaining some succour from better than expected broad money supply and credit demand data on what is otherwise expected to be a quiet session after a long weekend and tomorrow also being a public holiday.
At 08:50, the benchmark R157 bond was at 6.440 percent from its previous close of 6.460 percent. The R207 was bid at 7.555 percent and offered at 7.525 percent from a previous close of 7.560 percent and the R186 was offered at 8.160 percent from its close of 8.165 percent.