South African bonds were slightly weaker on Friday morning with market attention still on developed market central banks. Emerging markets, including SA, are on high alert to see what action the developed countries’ central banks will take, as they could affect capital flows. On Wednesday, US Federal Reserve officials voted unanimously to keep interest rates on hold, putting the dollar under pressure against most currencies, which favoured emerging-market currencies. The Fed, however, indicated that it would soon start unwinding its $4.5-trillion balance sheet. Last week, the European Central Bank (ECB) and the Bank of Japan (BoJ) also left interest rates unchanged. Sasfin Securities analysts said "emerging-market bonds are experiencing renewed attention as developed nations’ central banks appear to be taking a more cautious approach to balance sheet run-off". At 9.01am the R186 was bid at 8.54% from Thursday’s 8.51%. The rand was at R12.9884 to the dollar from R13.0003.
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