South African bonds lost further ground by Monday afternoon, as the rand hit R14.55 to the dollar, its worst level in about a year. A host of political issues are affecting the local currency and bonds, including concern about a probable downgrade announcement by Moody’s next week, as well as reports that President Jacob Zuma could announce a free tertiary education plan. Zuma released the long-awaited Heher-report on the funding of tertiary education on Monday. The commission recommended, among other things, that public technical and vocational education and training be fee-free. Markets also reacted negatively to the resignation of the Treasury’s long-time budget head, Michael Sachs, reportedly due to interference from Zuma’s office. His resignation was confirmed by the Treasury in a statement. "The announcement added further political pressure on the rand as it also coincided with the dollar trading stronger on rising US bond yields," said Novare market analyst Tumisho Grater. Co...
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