Johannesburg - The rand hit two-week highs against the euro and dollar on Thursday after the European Central Bank failed to deliver enough details on its bond-buying plans to quell debt crisis concerns, pushing investors who had shorted the rand back to the unit.

The rand strengthened 1.2 percent against the euro to 10.46 from 10.60 a day earlier, and climbed 1.7 percent to 8.2750 against the dollar, making it the top emerging market currency performer versus the dollar and tracked by Reuters.

They quickly got out of their long euro positions in late afternoon trade in a knee-jerk reaction after the ECB policy meeting gave investors few clues about the bank's plan to stem the euro debt crisis.

“We didn't see much that was new from the meeting itself, but I take it the confirmation for some in the market that they actually are going to be engaging in this unlimited spree of bond-buying has given a bid tone to EM currencies,” said Sean McCalgan, market analyst for ETM.

Investors were selling both euro/dollar and dollar/rand to buy back rand, which they had been taking short positions in since early August.

“It's a combination of the euro dropping and then the unwinding of the crosses after the announcement of the bond programme, which will be good for emerging markets as a whole,” said Ion de Vleeschauwer, dealer at Bidvest Bank.

The rand would need to break through the 8.20-22 region to entrench the rally, a level it bounced off 12 times in the last two months.

The 8.50 rand to the dollar area still provides support if the rally proves to be short-lived, dealers said.

Government bonds shrugged off the currency moves to end steady at 5.405 percent on the three-year benchmark and nudged up half a basis point to 7.35 percent on the 14-year issue.

Treasury managed to swap 2.2 billion rand of its 2014 bond into 14-year paper in a switching programme where it is rolling over the soon-maturing 2014 bond into longer-dated bonds to help manage its redemptions. - Reuters