Bonds extend losses as rand struggles to remain below R12.60 to the dollar
South African government bonds weakened further, from morning trade, on Wednesday afternoon, as the rand remained on the back foot on a rampant dollar.The euro fell below $1.20 for the first time in two months on the expectation that the US Federal Reserve will signal a more hawkish stance. This could result in four hikes this year instead of the expected three, which have already been priced in."The market is awaiting the Federal open market committee (FOMC) monetary policy statement this evening, with a hawkish hold expected," FxPro analysts said.The two-year US bond yield is now at its highest since 2008 and the 10-year is at about 3%, after seriously struggling to breach this threshold for months."The near term could be favourable for the greenback, as it attempts to claw back some of the losses incurred over the last 16 months," said Oanda analyst Craig Erlam. A stronger dollar usually signals higher bond yields.At 3pm, the R186 was bid at 8.28% from 8.18% and the R207 at 7.17%...
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