Rand set for biggest weekly gain against the dollar since December

The retreat in the dollar coincided with a decision on Thursday by the Turkish central bank to aggressively raise interest rates, which helped take the pressure off the lira and its peers.

“The question now becomes whether [emerging-market currencies] have a definite change of momentum or if this is just a knee-jerk reaction to the events in Turkey,” said Andre Botha, senior currency dealer at TreasuryOne.

Turkey was in the eye of the storm recently when its currency plummeted due to political and economic concerns — a development that hurt sentiment towards emerging markets.

Meanwhile, Moody’s has allayed concerns that SA’s investment grade status could be under threat, saying on Thursday that it expects the economy to pick up.