The rand remained stable during Thursday afternoon trade, looking offshore for direction as SA heads into the long weekend, a trader said.
SA markets are closed on Friday for the Freedom Day public holiday, and again on Tuesday for Workers Day.
The rand posted some gains earlier in the day following a weak performance by the US dollar. The dollar took a knock after the US Federal Reserve Markets Committee decided to keep rates ultra-low, which was contrary to market expectations.
"Generally speaking the rand looked offshore for direction. The weakened dollar also contributed to its position. There has been a lot of offshore selling and this has impacted on the rand performance," said the trader.
At 15:41 local time the rand was bid at R7.7752 to the dollar from its previous close of R7.7444. It was bid at R10.2706 to the euro from R10.2350 before, and at R12.5699 against sterling from R12.5170 previously.
The euro was bid at US$1.3217 from its previous close of $1.3223.
RMB analysts said in their morning report that the rand had continued to strengthen on Wednesday as a general rise in global risk appetite supported the local unit.
Indicators of global risk appetite such as global equity markets, the VIX and EM sovereign spreads also improved. Growth-sensitive commodities, including oil and copper, also rebounded.
Dow Jones Newswires reported that the euro and pound were among the chief beneficiaries as investors sold the dollar in European trading on Thursday after the US Federal Reserve's decision.
The euro rose to a three-week high against the dollar at $1.3263 as investors digested Fed chief Ben Bernanke's comments late on Wednesday that the US central bank remained willing to use its balance sheet to stimulate the world's biggest economy if the labour market weakened or inflation expectations fell below its target.
European equities rallied and peripheral eurozone sovereign bond yields also eased on the news.
"The Fed's comments have provided a positive environment for ... risk-sensitive currencies and has allowed them to stage a recovery as the dollar comes under pressure," said Ian Stannard, European head of foreign exchange strategy at Morgan Stanley.
Bonds stay firm on short-covering
Bonds were up to 5 basis points firmer on Thursday afternoon, which a trader said was on the back of a "bout of short-covering".
At 15:50, the benchmark R157 bond was at 6.475 percent from its previous close of 6.485 percent. The R207 was bid at 7.560 percent and offered at 7.555 percent from a previous close of 7.580 percent and the R186 was trading at 8.150 percent from its close of 8.200 percent.