The rand firmed slightly against the dollar on Wednesday after comments from Reserve Bank governor Gill Marcus about not going soft on inflation raised expectations of an interest rate hike.

In a speech on Tuesday evening, Marcus said the Reserve Bank would take whatever measures necessary to tackle rising consumer inflation.

The central bank kept rates steady at 5.5 last week. It has cut rates by 650 basis points since 2008, taking lending costs to their lowest in three decades.

"She did say that she will not be soft on inflation, which I think has got the interest rate markets quite excited," said Jim Bryson, a trader at Rand Merchant Bank.

The rand was trading at R6.8534 against the dollar at 06:34 GMT, a shade stronger than Tuesday's New York close of R6.8505.

Marcus also said the bank would continue to build reserves, although reiterated that she did not have a target level for the rand.

"No real change in the rand implies there will still be reserve accumulation, and they are not obviously targeting a specific level in the rand so nothing has changed for the rand," Bryson added.

The rand gained about 12% against the dollar last year despite the central bank spending just under R55bn accumulating reserves.

Separately on Wednesday, figures showed growth in credit demand by South Africa's private sector accelerated 5.43% year-on-year in February compared with 5.01% in January.

Growth in the broadly defined M3 measure of money supply slowed to 7.55% year-on-year compared with a 8.19% in January.

Government bonds eased fractionally after weakening on Tuesday after an auction that saw yields jump more than 6 basis points.

The yield on the 2015 bond R157 was up 2.5 basis points at 7.85% and that on the longer dated 2026 note R186 was up 0.2 basis points at 9.015%.