South African bonds reversed earlier gains shortly before midday on Thursday after Statistics SA data showed producer price inflation increased to 4.8% in May compared to 4.6% in April.At 11.40am, the benchmark R186 was bid at 8.68% from Wednesday’s 8.67% and the R207 at 7.58% from 7.575%.A consensus of economists polled by Trading Economics had been for a 4.7% increase.Lower inflation rates tend to support bonds, however, investor interest in emerging-market bonds has dropped off a bit from recent high levels. "Although the recent fairy-tale inflows into SA may be abating somewhat, offshore investors still took up a reasonably big chunk of Tuesday’s National Treasury auction," Rand Merchant Bank analyst Deon Kohlmeyer said.Global markets are still digesting perceived hawkish comments made by US Federal Reserve and European Central Bank (ECB) officials this week, which have boosted the euro against the greenback.On Tuesday, US Federal Reserve chairwoman Janet Yellen reiterated her v...
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