Bonds are unchanged on geopolitical tension following net outflows
South African bonds were largely unchanged at midday on Friday on a weaker rand and as US treasury yields rose on higher inflation data. The US consumer price index (CPI) rose 0.4% month on month in August, with much of the gain owed to a sharp rise in petrol prices caused by Hurricane Harvey. On an annual basis, consumer inflation came in at 1.9%, just below the US Federal Reserve’s 2% target. Barclays Research analysts have predicted that consumer inflation could climb to 2.2% in September. That raised expectations that interest rates could be hiked later this year. "We maintain our view that a December rate hike remains on the table, but also point out that it is still dependent on incoming data on labour markets, activity and inflation," Barclays said. However, the market remains unconvinced about this option as the dollar lost ground against the euro with added concern emanating from the Far East after North Korea fired another missile over Japan. "The local bond market recorde...
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