Rand pulls back after hitting two-week high

Johannesburg - The rand retreated slightly on Thursday after touching its strongest level in two weeks when the Federal Reserve hinted it would wait to hike interest rates, boosting emerging market currencies.    

At 10:53, the rand was 0.22% weaker at R12.29/$, compared with its overnight New York close of 12.27.

"After sharp gains overnight, the rand is looking choppy as it struggles to find new levels in a more dovish Fed world," said Rand Merchant Bank in a client note.

"The fact that it has gone a little weaker this morning is a reflection of how far it came overnight and you will find some traders looking to mop up some dollars at these levels," said George Glynos, managing director at ETM Analytics.

The world's biggest economy was expected to raise rates in September but Fed chair Janet Yellen on Wednesday emphasised that the rate decision was still up in the air and rested on further improvement in the labour market.

READ: Fed says US economy strong enough to handle rate hike

Bonds were stronger, with the yield on the benchmark 2026 note dipping 12 basis points  at 8.360%.