Every week we give you our summary of happenings in the bond market.
The release of August fiscal data did nothing to change our minds with respect to the expectation of a significant larger fiscal deficit shortfall than budgeted. Not that this matters to foreign and other cross-over investors. Foreign buying remains strong as this crowd still take their cue from low global bond yields, low inflation and broad based easy monetary policy. The link between the low growth trap, the dire fiscal situation and South Africa’s sovereign credit ratings are simply brushed aside.