SOUTH African bonds were slightly firmer late on Tuesday, reflecting a stronger rand that broke through R12 to the dollar in the afternoon due to a softer dollar against other major currencies.

The greenback retreated after US March trade deficit figures disappointed.

At 3.40pm the local currency was trading at R11.9964 to the greenback, after hovering near the R12 to the dollar level in intraday trade.

The benchmark R186 was bid at 8.035% and offered at 8.025% from a previous close of 8.040%.

The middle-dated R207 was bid at 7.510% and offered at 7.505% from a Monday close of 7.520%.

Meanwhile, US Treasuries strengthened on Tuesday for the first time in seven sessions as a surging trade shortfall raised some concerns over the resilience of US economic growth, Dow Jones Newswires reported.

In recent trading, the yield on the benchmark 10-year Treasury note was 2.119%, according to Tradeweb. The yield was 2.135% on Monday, the highest closing level since March 9.

When bond prices rise, their yields fall.

The US trade deficit widened by 43.1% to a seasonally adjusted $51.37bn in March, the US Commerce Department said on Tuesday. This is the largest monthly expansion in the trade gap since December 1996, suggesting that international commerce was a significant drag on economic growth at the start of the year, the newswire said.

Market participants are now awaiting data drivers such as the US ADP employment print on Wednesday and the all-important US nonfarm payroll data on Friday.

Economists polled by The Wall Street Journal expect 228,000 new jobs were added last month, sharply rebounding from 126,000 in March.

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