Stats SA reported on Tuesday that country's GDP growth exceeded National Treasury's expectation of 1.0% growth announced during the National Budget Speech in February a year ago, and shot far past market expectations which ranged from 0.2% to 0.8%.
The rand was trading at R11.81/dollar on Tuesday afternoon (6 March), in an immediate response to the announcement that South Africa's GDP expanded by 3.1% in the fourth quarter of 2017, and by 1.3% for the year as a whole.
"In a time when good news seems hard to come by, the latest GDP results provide some cautious cheer", Statistics SA said in a statement.
The growth was above market expectations of a quarter-on-quarter GDP expansion of 1.8 percent, according to a Reuters poll.More news: Trump Says Oscars Ratings Were Low Because 'We Don't Have Stars Anymore'
"Ratings agencies are much more likely to focus on structural reforms, and the higher growth rate that now looks possible over the coming years", Standard Chartered Bank's Chief Africa Economist Razia Khan said.
Growth for 2016 was revised up to 0.6% from 0.3%.
On the other hand, the mining and quarrying fell 4.4 percent thus dragging the overall growth by 0.3 of a percentage point.
The changes were based on better access to data sets, said Statistics SA deputy director-general Joe de Beer.More news: Veeva Systems Inc (VEEV) SVP Frederic Lequient Sells 2875 Shares of Stock
The revisions indicate that South Africa was not plunged into a recession previous year.
"The Presidency hopes that growth of the kind experienced in Quarter 4 will be sustained and that it will translate into meaningful job creation".
At the tabling of the 2018 budget in the National Assembly last month, former Finance Minister Malusi Gigaba said that while many challenges in the South African still remained, there is a sense of optimism about the economy going into the future, especially with the newly elected President Cyril Ramaphosa in charge of Pretoria.More news: Spice Girls lift lid on Meghan and Harry Royal Wedding invite