South African bonds were a little firmer on Thursday morning as the market followed the rand, which on Wednesday reached its best level against the dollar since mid-May 2015. Bonds have gained in 2018 on the expectation of a interest-rate cut by the Reserve Bank. But the momentum has become more subdued ahead of February 21 budget, which Finance Minister Malusi Gigaba is scheduled to deliver in Parliament. Moody’s will deliver the result of its latest ratings review soon thereafter. Bonds have showed little reaction to the prospect of lower inflation over the short term. Nedbank Corporate and Investment Banking analysts said there was room for the Reserve Bank to cut interest rates by 50 basis points. Consumer inflation rose to 4.7% in December, from 4.6% previously. "Our outlook on inflation is dovish, as we expect further downside risks to the Bank’s CPI [consumer price index] profile over the medium term," Nedbank said. At 9.03am the R186 was bid at 8.34% from 8.35% and the R207 ...
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