At 1511 GMT, the rand was 1.62 percent firmer at 14.7325 per dollar, just shy of its session-best 14.7000 touched immediately after Turkey's central bank raised its benchmark rate by 625 basis points.

The Turkish lira firmed 6 percent following the decision.

Before that, the rand had been rising as easing tensions between the United States and China fuelled risk demand in early, low liquidity trade.

Moody's comment at a conference in Johannesburg that it was unlikely to cut Pretoria's foreign debt to subinvestment, despite last week's surprise slide into recession, pushed the rand's gains to more than 1 percent.

"Emerging market currencies have been moving as a basket recently and the Turkish central bank's rate move was definitely a catalyst for the rand move. The Moody's comment is the second catalyst," said IG Markets strategist Shaun Murison.

"Overall sentiment remains negative around emerging markets as a whole. So this is likely a short term recovery, sort of the inverse of a dead cat bounce," Murison said.

Moody's warned any growth recovery would be slow and that commitment to fiscal consolidation would be key to maintaining the country's rating.

Data on the day showing mining output had shrunk again, 5.2 percent year-on-year in July, hardly upset the currency, which is now trading back where it was before the recession data last Tuesday.

Bonds also gained, with the yield on benchmark government paper due in 2026 down 5.5 basis points to 9.12 percent.

On the bourse, the blue chip top 40 index was 0.35 percent higher at 49,991 points while the broader all share index gained 0.38 percent to close the day at 56,167 points.

"The market has been driven higher by optimism in Asia but most sectors have been swinging between gains and losses on a volatile trading day," said Nedbank Private Wealth stock broker, Kyle Burgess.

Impala Platinum was one of the biggest gainers, rising 5.38 percent to 17.63 rand, as investors looked past one-off taxation charge that swung it into a loss and focused on operationally stronger results.

On the downside, drug maker Aspen Pharmacare plummeted as much as 20 percent after selling its infant formula business to French company Lactalis for 12.9 billion rand ($881 million), a price tag that fell short of market expectations.

Shares in Aspen closed 14.84 percent lower at 230.64 rand.