The annual interest rate investors demanded from the government’s R186 10-year bonds rose by six basis points, or 0.7%, on Wednesday morning, to 8.64% from 8.58%. The rising yield came in tandem with the rand weakening to near R12.50 to the dollar, as a rally in which the rand strengthened to R12.24 on December 28 took a breather. The rand’s "Ramaphosa rally" — in which the currency strengthened from about R13.50/$ before the ANC’s conference started on December 16 to under R12.30 after Cyril Ramaphosa’s victory in the party’s presidential election was announced on December 18 — was accompanied by the R186 bond’s narrowing yield. On December 14, before the ANC’s conference, the R186 bond’s yield was 9.275%. This narrowed all the way to 8.535% on December 27 on reports the ANC’s new leadership was negotiating and early end to President Jacob Zuma’s scandal ridden term ahead of SA’s 2019 national elections.

BL Premium

This article is reserved for our subscribers.

A subscription helps you enjoy the best of our business content every day along with benefits such as exclusive Financial Times articles, ProfileData financial data, and digital access to the Sunday Times and Times Select.

Already subscribed? Simply sign in below.

Questions or problems? Email or call 0860 52 52 00. Got a subscription voucher? Redeem it now