Taking a breath…

The rand paused off near five-year highs against the dollar on Friday and analysts predicted a breach of the key R6/$1 level this week provided the euro does not weaken significantly.

The rand retreated to an intraday low of R6,1025 to the dollar, with traders citing profit-taking following failure to crack R6 against the dollar - its best level since October 6 1999 - after briefly testing the level on Thursday. RMB AM and Business Day report.

In afternoon trade the rand was bid at R6,09 to the dollar compared to R6,05 at close on Thursday. There has to be profit taking if it is making such hard work of it (breaking through R6/$).

The rand will continue to test stronger as long as the euro does not weaken too much.

The dollar fell sharply against the yen on Friday ahead of yesterday's Japanese election that may see Prime Minister Junichiro Koizumi win support, enabling him to maintain the country's yen-boosting economic reforms.