At 1020 GMT, the rand traded at 18.0425 against the dollar, around 0.5% stronger than its previous close.
It earlier traded below 18 to the dollar for the first time since April 20, after closing up 2% on Wednesday when U.S. inflation came in slower than expected.
Casparus Treurnicht, a portfolio manager at Gryphon Asset Management, linked the rand's gains to the dollar's weakness, saying the Fed now had less incentive to keep raising rates in light of fading price pressures.
Andre Cilliers, currency strategist at TreasuryONE, said given the pace of its recent rally, the rand could consolidate around 18 to the dollar, pointing to fairly healthy dollar demand late on Wednesday when South African importers took advantage of better hedging levels.
In a sign of domestic economic challenges, data on Thursday showed South Africa's total mining output fell 0.8% year-on-year in May, down from a revised increase of 3.2% in April.
April was the first month mining output had recorded growth in 14 months and analysts polled by Reuters predicted output would expand 1.4% in May.
Miners face headwinds including the worst rolling blackouts on record, a major drag on power-hungry sectors.
On the Johannesburg Stock Exchange, the blue-chip Top-40 index last traded around 0.6% stronger than its closing level on Wednesday.
Despite the weak mining data, the resources index was up around 1.3%, helped by higher precious metals prices.
South Africa's benchmark 2030 government bond was also stronger on Thursday, as the yield fell 7.5 basis points to 10.385%.
(Reporting by Tannur AndersEditing by Alexander Winning and Sonia Cheema)
