The rand traded at 18.0100 against the dollar at 1623 GMT, 1.89% stronger than its previous close.
The dollar index, which measures the U.S. currency against six rivals, was down about 0.96% at 111.96.
Jeremy Hunt, who was appointed as the new UK finance minister by Prime Minister Liz Truss on Friday, made a U-turn on many of the provisions of the 45-billion pound "mini-budget" put forth by the government that led to a massive selloff in the bond market.
Hunt's moves calmed investors' nerves and helped slightly strengthen riskier currencies, even though the local currency continued to trade below the 18 rand per dollar range as inflationary pressures still dictated investor sentiments.
"Tightening financial conditions continue to spur risk aversion, keeping the rand weak, with policy makers expected to remain focused on quelling price inflation, crushing hopes of economic improvement and market recovery," Annabel Bishop, an analyst with lender Investec wrote in a note.
The rand has reached a new weak point this year against the U.S. dollar, at 18.58 for a dollar, and is experiencing a longer sustained period of weakness than seen in 2020, she said.
In stocks, the indexes on the Johannesburg Stock Exchange regained considerable ground on Monday after the UK policy U-turn, taking cues from most major global bourses.
The blue-chip index Top-40 closed up 3.1% at 59,638 points and the benchmark all-share index closed up 2.99% at 66,191 points.
The government's benchmark 2030 bond was little changed in early deals, with the yield down 4 basis points at 10.780%.
(Reporting by Anait Miridzhanian and Promit Mukherjee; Editing by David Goodman and Shounak Dasgupta)
