The vulnerable rand was weaker in afternoon trade‚ well off the morning’s best levels on Monday‚ with the excitement over the weekend Greek election results having fizzled out as analysts say the situation remains much the same - uncertain.

The local currency had initially absorbed the Greek poll results positively but lost its gains in midday trade as the uncertainty in the eurozone persisted.

Media reports said fresh worries over debt problems in Spain and Italy wiped out initial relief from a victory for pro-bailout parties in Greece that had sparked an earlier rally on the markets.

Spanish and Italian government bond yields rose‚ dogged by concerns about Spain's fiscal and banking problems.

Spanish 10-year government bond yields rose 22 basis points on Monday to 7.14 percent‚ pushing the nation's implied borrowing costs to their highest during the euro's lifetime‚ the reports said.

At 18:00 the rand was bid at R8.3480 to the dollar from its previous close of R8.2475. It was bid at R10.4889 to the euro from its previous close of R10.4887 and at R13.0700 against sterling from R12.9599 before.

The euro was bid at US$1.2576‚ from its previous close of $1.2718.

“The markets absorbed the Greek poll news positively‚ but there is still risk in the market. Players are still cautious and will be watching Europe for direction. The Spanish situation is also of concern and on the back of that many believe the rand will remain slightly weaker ahead of other data that is due this week‚” a local trader said.

Bonds

South African bonds eased in afternoon trade on Monday as the euro weakened as the euphoria on the Greek election result was replaced by renewed concerns about other eurozone countries.

“We had a good start on the Greek election result‚ but in the cold light of day it became increasingly evident that the eurozone problems have not been solved‚ so the euro weakened from $1.2728 to $1.2578. That prompted a sell-off in the rand and bonds just followed. In addition we have a fair bit of supply coming onto the market‚ so that is weighing on sentiment as well‚” a local trader said.

At 18:00‚ the benchmark R157 bond was trading at 6.000 percent from a best level of 6.065 percent in early trade and Friday’s close of 6.090 percent. The R207 was bid at 7.425 percent and offered at 7.395 percent from a previous close of 7.400 percent and the R186 was trading at 8.140 percent from its previous close of 8.110 percent.