South Africa's rand gained more than 2% on Tuesday, bouncing off a two-year low struck a day before, when investors dumped emerging market assets because of fears over the Turkish economy.
At 0705 GMT, the rand traded at 14.0800 versus the dollar, around 2.3% stronger on the day and more than 11% stronger than its weakest on Monday.
Government bonds also rose, as the yield on the benchmark government bond maturing in 2026 fell 11 basis points to 8.94%.
The rand, one of the most traded emerging market currencies worldwide, is highly susceptible to swings in sentiment on global markets.
On Monday it was rattled by a plummeting Turkish lira, which has been dragged lower by worries over President Tayyip Erdogan's calls for lower interest rates and worsening ties with the United States.
"I don't think this volatility is going to stop just yet," said Warrick Butler, executive head of rand trading at Standard Bank.
"If sanity returns in some small way, then there is a very good chance that we will trade back below 14.0000 (to the dollar), but don't hold your breath."
Despite the sharp slide in the rand on Monday, a deputy governor at the South African Reserve Bank told Reuters the regulator was "nowhere near" intervening to support the currency.
The lira gained on Tuesday after the country's central bank pledged to provide liquidity, helping lift the mood on Asian markets.
The rand is down around 12% against the US currency this year.
South Africa has a narrower current account deficit and smaller stock of short-term external debt than Turkey, and the economy is expected to grow modestly this year after a torrid first quarter.
Johannesburg-listed shares opened slightly weaker, with the All-share index down 0.5% in early trade.