South African government bonds were a fair bit weaker on Tuesday afternoon as the rand slumped 2% against the dollar after US treasury yields spiked. The yield on the US 10-year rose to 3.0438% from 2.9987% after retail sales there went up a monthly 0.3% in April, following an upwardly revised 0.8% jump in March. This raised market expectations that the US Federal Reserve will hike interest rates more aggressively this year on a strong economy, causing the dollar to gain sharply on the euro. Yields on European bonds were also somewhat higher, following in the footsteps of the US market. "Higher US treasuries generally don’t bode well for emerging markets," said TreasuryOne dealer Gerard van der Westhuizen. At 3.01pm, the benchmark R186 government bond was bid at 8.47% from 8.325% and the R207 was at 7.33% from 7.19%. The rand was at R12.5843 to the dollar from R12.3287. The German 10-year bund was at 0.6324% from 0.6098%. The South African benchmark 10-year yield has fallen to an av...
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