South African bonds were weaker on Friday at midday amid a lack of further detail about President Jacob Zuma’s departure as head of state. A resumption of the global sell-off in equities weighed on the local market, after US bond yields trended higher on some consolidation earlier in the week. Rand Merchant Bank (RMB) analyst said the weakness among banks gained further traction on Thursday after the Bank of England (BoE) expressed a hawkish forward view, as UK consumer inflation hit 3%. "For a while now, higher US treasuries have been seen as a by-product of stronger growth and inflation," he said. On Friday, the BoE today stated that "monetary policy would need to be tightened somewhat earlier and by a somewhat greater extent over the forecast period than anticipated at the time of the November report". This means that increased confidence in a better economic outlook, emboldened the central bank to call for earlier hikes than previously expected, most likely in August from the pr...
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