At 1610 GMT, the rand traded at 14.7350 against the dollar, 1.41% stronger than its previous close.
The South African currency had a strong run this week, rising by over 3.5% and mainly boosted by a rebasing of gross domestic product data that showed South Africa's economy was 11% bigger in 2020 than previously thought.
In a speech to the Jackson Hole economic conference, the Fed chair said the U.S. central bank will remain patient as it tries to help the economy and would avoid chasing "transitory" inflation.
The rand has been highly volatile this year and investors feel that though the Fed continues to be dovish, the rand will be on a slightly weaker footing in the long run.
"Tapering is coming, we all know this. But as long as it's a gradual approach, it doesn't upset the market," said Wayne McCurrie, portfolio manager at FNB.
The fair value of the rand is around 15.50 per dollar, he said, adding that while the commodity cycle will not collapse and hence the currency would not weaken heavily, it would still be lower than what it is as the cycle has already turned.
Currencies in resource-driven countries such as South Africa also depend on the price of the commodities as higher prices bring in more foreign capital to the extractive industries.
Johannesburg-listed stocks also reacted positively after Powell's speech with the benchmark all-share index closing up 0.86% to 67,646 points, wiping out all of this week's losses.
The blue-chip index of top 40 companies ended up 0.88% at 61,393 points.
South Africa's benchmark 2030 government bond was slightly stronger, with the yield dropping 5 basis points to 8.815%.
(Reporting by Alexander Winning and Promit Mukherjee; Editing by Christopher Cushing and Susan Fenton)
