Bonds weaker ahead of budget as rand loses out on rebounding dollar
South African government bonds were slightly weaker at midday on Tuesday ahead of Wednesday’s budget, as the rand lost ground against a stronger dollar.The dollar was firmer against the euro amid a renewed sell-off in US bonds, which saw the 10-year yield reach 2.9243%, the highest level in more than two-and-a-half years.Wednesday’s budget will be the primary local market-moving event this week, as investors and ratings agencies gauge to what extent the government will rein in spending. SA’s fiscal deficit is being closely watched by agencies, including Moody’s, which will announce its credit rating in March.On Monday, ratings agency Fitch revised SA’s growth outlook for 2018 upwards, while warning that it remained low.At 11.30am, the benchmark R186 bond was bid at 8.135% from 8.080% while the R207 was at 6.795% from 6.735%. The rand was at R11.7484 to the dollar from R11.6722.The yield on US 10-year treasuries was last seen at 2.9069% from 2.8777%.Emerging-market yields are still r...
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