South African bonds were softer shortly before midday on Tuesday, with the benchmark R186 approaching a yield of 9.50%, as the rand came under some pressure. Local focus was on a Reserve Bank monetary policy decision on Thursday, while on Friday, ratings agencies S&P Global Ratings and Moody’s will release their latest credit reviews. Given these risk events it was unsurprising bonds were weakening, said Rand Merchant Bank analyst Gordon Kerr. Buyers would be expected to step into the market once again, with yields still offering a tremendous amount of value when compared to the local growth and inflation outlook, he said. Equity markets last week posted their seventh consecutive weekly inflow from foreign investors. The bond market by contrast, saw outflows of R1.8bn, but monthly inflows into the bond market for November were still positive, at R1.8bn. Foreign flows may remain volatile over the next few months, but annual foreign flows into the bond market were still positive at R6...
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