The rand stabilised on Friday morning, after another testing week for emerging-market currencies.

It was in slightly better shape on Friday, but poised to finish the week weaker as it felt the full force of a strong dollar.

Indonesia’s central bank raised interest rates by 25 basis points on Thursday to counter the effects of a stronger dollar on its currency, the rupiah, joining Turkey and Argentina, which recently tightened their monetary policies.

The South African Reserve Bank is expected to hold fire on rates when its monetary policy committee meets next week, but is likely to flag the global developments and their possible effect on the inflation outlook.

The rand has weakened materially since the last monetary policy committee meeting in March, where the committee cut rates by 25 basis points and uncharacteristically labelled the rand "overvalued".

Capital Economics senior emerging markets economist William Jackson said in an e-mailed note to clients that the current sell-off was unlikely to lead to broader tightening of financial conditions in emerging markets.

This excluded Turkey and Argentina, which were reeling from their own domestic economic challenges, including higher current accounts, higher inflation and high foreign currency debts, which Jackson said made them vulnerable to a stronger dollar.

US government bond yields rose significantly this week, implying that rates could increase at a faster rate than the market was positioned for.

Faster increases in interest rates in the US could detract from the so-called carry appeal — where money is borrowed in low interest rate environments and invested in currencies that offer higher returns.

At 9.28am, the rand was at R12.5292 to the dollar from R12.5994, R14.8043 to the euro from R14.8615 and R16.9250 to the pound from R17.0312.

The euro was at $1.1816, from $1.1795.