Government paying more than banks to borrow over five years
Increased supply of shorter-dated government debt pushing up yields
16 November 2020 - 19:12
The government’s five-year borrowing costs now exceed those of the nation’s banks despite the latter facing the deepest economic decline in decades and that they rely on the government as a lender of last resort in times of crisis.
The yield curve of SA’s sovereign bond market shows that five-year government yields are hovering at about 6.25%, more than 50 basis points higher than five-year borrowing costs for local banks...
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