"I see some appreciation of the rand against the US dollar, especially because of the high interest rate differentials," said Asmara Jamaleh from Intesa Sanpaolo.
The repo rate is currently at 5 percent, a 40-year low for the benchmark rate and the latest South Africa Reuters Econometer sees it unchanged until 2014, well above the benchmark rates of developed economies. Inflation should remain within the Reserve Bank's 3-6 percent target range in the next three years.
The rand has traded in a wide choppy range in the last three months due to global uncertainty as well as domestic issues such as the large current account deficit and labour unrest in the key mining sector.
South Africa is the world's top platinum producer and its mines have been hit by wildcat strikes that are now spreading to gold producers, after a settlement for Lonmin's Marikana workers set a precedent for the rest of the sector. The rolling monthly rand poll has been bullish since April, calling for a stronger rand on the back of the world's richest nations injecting liquidity into the financial system, spurring on risk appetite for emerging markets.
"I think that there are also better prospects for the economy next year, also with respect to the current situation in the mining sector," added Jamaleh.
The Econometer shows growth slowing to 2.5 percent this year due to the mining stoppages, but accelerating to 3.2 percent next year. To help bolster the economy, the US Federal Reserve last month launched a third bond-buying programme while the European Central Bank agreed to launch a new and potentially unlimited bond-buying programme to lower euro zone countries' borrowing costs.
But an expiry of US tax breaks and automatic spending cuts is set to come into effect at the start of next year, dubbed the "fiscal cliff" which is clouding the outlook for risk appetite.