The South African bond market extended losses in afternoon trade on Monday, mirroring hefty rand losses, which carry the potential to re-ignite inflation concerns. The yield on the benchmark R186 bond rose to 8.60%, from 8.49% on Friday, as the rand weakened substantially to the dollar, euro and the pound. The weakness in the local fixed-income market and the rand came after President Jacob Zuma survived another attempt by the ruling ANC national executive committee to remove him from office. Calls for Zuma to stand down as the country’s president reached fever pitch late in March when he fired Pravin Gordhan as finance minister, in a Cabinet shuffle that raised questions about the policy continuity. Local bonds and the rand face some risk this week as S&P Global Ratings is set to release its latest review of SA’s sovereign debt on Friday. There is also the possibility that Moody’s will also pronounce on the country’s debt rating this week.
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