Every week we give you our summary of happenings in the bond market.
For now, the broader theme remains one of local developments being overshadowed by the global carry trade. The inability of Transnet to issue bonds at three consecutive primary auctions in full size is arguably a more representative reflection of local investor concern. While it’s true that Moody’s is behind the ratings action curve, we are more concerned about our country’s ability to generate and sustain a higher structural growth rate. Failure to resolve this will turn out to be bearish to bonds via the fiscal channel.