South African bonds were slightly firmer on Friday morning following the Reserve Bank’s decision to leave interest rates unchanged.On Thursday, the Bank’s monetary policy committee (MPC) kept the repo rate unchanged at 6.75% after it cut it from 7% in July.Reserve Bank governor Lesetja Kganyago surprised most analyst and economists, who had expected a cut, given the current economic climate and easing inflation.Kganyago referred to political risks‚ the possibility of further sovereign credit rating downgrades and prospects of increased electricity tariffs as reasons to keep the repo rate unchanged.Nedbank analysts said the MPC decision was always likely to be close, given heightened political and policy uncertainties bedevilling the economy and global markets. The analysts said there was still a chance of a rate cut at the November meeting, which would be based on lower inflation, even though any weakness in the currency ahead of the ANC’s elective conference in December would reduc...
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