The rand was 0.5 percent firmer at 8.5600 against the greenback at 0640 GMT, from the close of 8.6020 in New York on Wednesday.

The currency slumped to within a whisker of 9.0 to the dollar last week - a 3-1/2 year low - amid concerns about the impact on growth of weeks of wildcat walkouts in South Africa's' mines.

Some miners are gradually returning to work, although tens of thousands in the platinum and gold sector remain on strike and Gold Fields looks likely to fire 23,000 wildcat strikers after a 1200 GMT deadline expires today.

The rand has rallied more than 4 percent since then - brushing off a ratings downgrade by S&P - buoyed by a rally in the euro after Spain avoided a ratings cut by Moody's.

Better-than-expected housing data from the United States as well as improved industrial production and retail sales figures out of China also improved global sentiment.

 Market analysts say the risk of a blow-out in the local currency has receded, with support building round the 8.58 level.

"The fact that a lot of the bad news has been washed under the carpet makes it look like we could have a little bit of a pull-back now," said Warrick Butler, a currency trader at Standard Bank.

 "But I think down to 8.45-47, you'd probably start seeing importers get back into the market again."

Government bonds were mixed after a rally on Wednesday in line with the currency.

The yield on the 2015 bond was up 1 basis points to 5.37 percent and that on the 2026 paper was down 3 basis points to 7.58 percent.