Johannesburg - The rand firmed slightly against the dollar on Tuesday and is seen maintaining its gains, partly supported by firmer metal prices.
The rand did not react much to a National Treasury announcement to raise the amount of assets institutional investors can take abroad, with analysts saying they are not expecting massive outflows after the news.
By 06:37 am, the rand was trading at R6.8320 against the dollar, 0.2% firmer than Monday's New York close of R6.8475. It hit a one month high of R6.8220 on Monday.
"The rand has very good support in the R6.78/80 area and that's why we are not rushing to break it (support)," said Jim Bryson, chief dealer at Rand Merchant Bank. "I'd look to trade R6.82 to R6.86 to begin with and through R6.82 to R6.78, but we are euro-dependent," he added.
Firmer metal prices are also expected to support the rand in the sesssion.
Government bonds firmed in line with the rand. Bonds have gained sharply as foreign investment into the local debt has tripled this year compared to last.
The yield on the 2015 bond R157 fell 8.5 basis points to 7.38% and that on the 2026 note R186 down 9.5 basis points to 8.41%.
Focus will be November's inflation release at 0930 GMT. The market is expecting CPI to tick up to 3.5% year-on-year, from 3.4% in October.
A higher than expected figure will dim hopes of another interest rate cut on January 20, and bonds may trim gains.