JOHANNESBURG: South Africa's rand regained some ground against the dollar on Thursday in position-squaring ahead of the long Easter weekend, but gains might stall next week as the weak global economic outlook remains a deterrent to risk appetite.

The rand was 0.54 percent firmer at 7.79 to the dollar by 0656 GMT after ending the previous session at 7.8320.

 The currency tumbled more than 1.2 percent to seven-week lows on Wednesday amid signs global growth is losing steam.

"Ahead of the Easter long weekend there may very well be some position squaring that boosts the near term prospects for the rand and indeed other EM currencies. We would not however read too much into this," Tradition Analytics said in a note.

South African markets will be closed on Friday and Monday for Easter, with trading resuming on Tuesday.

Government bonds were largely stagnant in early trade, with the yields on the benchmark three-year paper and the longer-dated issue due in 2026 each dipping half a basis point to 6.805 percent and 8.505 percent respectively.

"I think global currencies and bonds are a little oversold in the short term and I would expect a little bit of a pull-back with all markets closed tomorrow, so a slightly stronger bias for bonds," Investec trader Steve Arnold said.

But the bond rally might fail to gain momentum next week, with offshore accounts, which have dominated the local debt market in the last two years, reluctant to take up more stock at the moment.

"I just think offshore accounts are fully invested in South AFrica currently ... and if your offshore participants are not buying South Africa, supply catches up with the locals," Arnold said.

Investors are also expecting the market to be flooded with paper when the Treasury offers longer-term securities in return for maturing debt in switch auctions next month.

The government is also due to issue five new bonds this financial year with tenures of up to 39 years.