The rand extended gains against the dollar in response to the data, rising 0.5 percent to hit a session high of R12.62 to the dollar.
Data from Statistics South Africa showed headline consumer inflation slowed to 6.3 percent year-on-year in February from 6.6 percent in January.
Sarb said the current account deficit narrowed to 1.7 percent of gross domestic product (GDP) in the last three months of 2016 from a revised shortfall of 3.8 percent in the third quarter.
The country last recorded a 1.7 percent current account deficit in the first quarter of 2011, the bank said.
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Economists surveyed had expected a 3.5 percent deficit for the final quarter.
“Following a brief contraction in the third quarter of 2016, the value of mining exports rebounded strongly in the fourth quarter, largely due to an increase in export earnings of mineral products, mainly iron ore and coal,” the bank said.
Exports rose 3.7 percent in value terms during the quarter, resulting in a trade surplus of R56 billion from a revised deficit of R7 billion in the third quarter.
For the year, the current account deficit narrowed to 3.3 percent of GDP from 4.4 percent in 2015.