Every week we give you our summary of happenings in the bond market.
The combination of sustained large global flows into emerging market debt, a stronger rand, downside surprises to local inflation data releases and market speculation about the outcome of the ANC’s NEC meeting contributed to lower yields. Looking ahead, the market is bracing itself for another, albeit smaller, trade account surplus as well as the S&P Global Ratings’ scheduled rating update on South Africa. We expect S&P to leave our ratings unchanged for now, but to retain the negative outlook. This by no means implies that we are out of the woods. We still expect more downgrades down the line.