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Johannesburg – The South African bond market firmed in midday trade on Tuesday after a well-bid auction at 11:00.
The National Treasury offered R800m worth of R214 bonds‚ R700m worth of R2023 bonds and R600m worth of R2048 bonds and received bids worth R1.305bn‚ R2.555bn and R1.515bn respectively.
“We had a good auction‚ which was in part helped by a firming rand going into the auction. Now we will see if the South African Reserve Bank follows the lead of the Reserve Bank of Australia (in cutting rates)‚ as we are both resource exporting countries‚” a local bond trader said.
At 11:52‚ the benchmark R157 bond was trading at 5.410% from 5.440% at Monday’s close and 5.370% at Friday’s close. The R207 was bid at 6.480% and offered at 6.450% from its previous close of 6.505%‚ and the R186 was trading at 7.540% from 7.555% at its previous close.
The rand was bid at R8.3388/$ from its previous close of R8.3556.
Dow Jones Newswires reported that the Reserve Bank of Australia cut interest rates for the first time since June‚ reacting to declines in key commodity prices and mounting evidence the country's mining investment boom was fading.
SA is on course to complying with revised Basel III capital and liquidity rules which come into effect in January‚ Daniel Mminele‚ the deputy governor of the South African Reserve Bank‚ said in a speech in Sandton on Tuesday.
Steps had also been taken to ensure that banks would be able to comply with the liquidity coverage ratio by next year after the central bank created a stand-by liquidity facility for banks to plug any shortfalls.
South African banks already meet the new tougher Basel capital rules but had confirmed they were unable to meet the liquidity coverage ratios‚ which require them to have ready access to liquidity to plug shortfalls from a hypothetical run on a bank for 30 days‚ without government assistance.
“A coordinated approach by regulators is thus imperative to ensure that the swing does not move to over-regulation‚ based on the experience of only one‚ thereby having detrimental effects or even introducing systemic risk in other jurisdictions‚” he said.
The National Treasury offered R800m worth of R214 bonds‚ R700m worth of R2023 bonds and R600m worth of R2048 bonds and received bids worth R1.305bn‚ R2.555bn and R1.515bn respectively.
“We had a good auction‚ which was in part helped by a firming rand going into the auction. Now we will see if the South African Reserve Bank follows the lead of the Reserve Bank of Australia (in cutting rates)‚ as we are both resource exporting countries‚” a local bond trader said.
At 11:52‚ the benchmark R157 bond was trading at 5.410% from 5.440% at Monday’s close and 5.370% at Friday’s close. The R207 was bid at 6.480% and offered at 6.450% from its previous close of 6.505%‚ and the R186 was trading at 7.540% from 7.555% at its previous close.
The rand was bid at R8.3388/$ from its previous close of R8.3556.
Dow Jones Newswires reported that the Reserve Bank of Australia cut interest rates for the first time since June‚ reacting to declines in key commodity prices and mounting evidence the country's mining investment boom was fading.
SA is on course to complying with revised Basel III capital and liquidity rules which come into effect in January‚ Daniel Mminele‚ the deputy governor of the South African Reserve Bank‚ said in a speech in Sandton on Tuesday.
Steps had also been taken to ensure that banks would be able to comply with the liquidity coverage ratio by next year after the central bank created a stand-by liquidity facility for banks to plug any shortfalls.
South African banks already meet the new tougher Basel capital rules but had confirmed they were unable to meet the liquidity coverage ratios‚ which require them to have ready access to liquidity to plug shortfalls from a hypothetical run on a bank for 30 days‚ without government assistance.
“A coordinated approach by regulators is thus imperative to ensure that the swing does not move to over-regulation‚ based on the experience of only one‚ thereby having detrimental effects or even introducing systemic risk in other jurisdictions‚” he said.
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