The rand broke through the R17 to the dollar level on Thursday for the first time in years, and analysts believe the currency may continue to strengthen in the coming weeks.
The improved performance follows a positive market response to the Medium-Term Budget Policy Statement, as well as growing optimism that South Africa may receive a credit rating upgrade.
Nicholas Pittaway from Sasfin says the currency’s recent gains are notable.
“It looks like our rand is starting to compete. It has been most impressive over the last year, strengthening by 5.8% against the dollar and 2.9% against the pound though it is still down 3% against the euro,” he said.
Market watchers say sentiment remains upbeat, with investors responding favourably to signs of improved fiscal discipline and stability.