Picture: THINKSTOCK
Picture: THINKSTOCK

South African bonds were slightly firmer on Wednesday morning despite a weaker rand, which they usually track.

A relatively weaker dollar supported the rand and bonds from testing weaker levels, as the risk of a credit downgrade looms over SA.

Indecision about proposed tax cuts in the US continue to weigh on the dollar.

Headlines relating to political uncertainty at the National Treasury and financial woes at state-owned entities (SOEs) had been driving weakness in the rand and bonds.

The rand weakened to R14.52 to the dollar in Tuesday while bonds clawed back some of the previous day’s losses, with the yield on the benchmark 10-year government bond closing at 9.45% from Monday’s 9.47%.

Investors will keep an eye on the building political tension in Zimbabwe, which has not affected the local market.

At 9.01 the R186 government bond was bid at 9.420% from 9.450%, while the R207 was bid at 8.135% from 8.150%

The rand was at R13.3951 to the dollar from R13.3644.

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