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Johannesburg - South African bonds were firmer in late trade on Thursday, mainly on the back of a stronger local currency. As largely expected the Monetary Policy Committee (MPC) kept the repo rate on hold at 5.5%.
By 15:50, the benchmark R157 bond was trading at 7.740% from its previous close of 7.790%, while the R207 was trading at 8.670% from its previous close of 8.640%. The R186 was bid at 8.895% from its previous close of 8.910%.
The rand was bid at 6.8601 to the dollar from its previous close of 6.9160.
"We're firmer - it started as the rand went down to the lower levels. The news was expected, guys are going through the speech to see if it was dovish or hawkish," said a local trader.
Notably, Governor Gill Marcus said the decision to keep rates on hold was unanimous, with no calls being made from the Committee for either an increase or a decrease in rates.
She refused to be drawn on speculating on whether rates would increase in the second half of the year, but did lift inflation forecasts upwards by half a percentage point for 2011 and 2012 in light of higher projected oil prices.
Interest rates remain at their lowest level in nominal terms in almost 30 years.
The repo rate was unanimously expected to remain unchanged according to a survey of leading economists by I-Net Bridge.
Rates were cut by 50 basis points to 5.5% for the repo rate in November and 9.0% for the prime rate.
Foreigners were net buyers of R79.761m of South African bonds including repo transactions on Wednesday after net purchases of R1.778bn of local bonds on Tuesday, Bond Exchange of South Africa statistics show.
Nominal cumulative volume was R70.434bn on Wednesday from R185.104bn on Tuesday.
Foreigners were net buyers of R91.173m of South African bonds excluding repo transactions on Wednesday after net purchases of R1.734bn of local bonds on Tuesday.
For the year to date, foreigners have been net sellers of R13.990bn worth of local bonds, excluding repo transactions. In 2010 foreigners bought net R57.064bn worth of local bonds, excluding repo transactions.
For the year to date for total transactions, including repo transactions, foreigners have been net sellers of R16.368bn of local bonds. In 2010 they bought net R44.541bn worth of bonds.
By 15:50, the benchmark R157 bond was trading at 7.740% from its previous close of 7.790%, while the R207 was trading at 8.670% from its previous close of 8.640%. The R186 was bid at 8.895% from its previous close of 8.910%.
The rand was bid at 6.8601 to the dollar from its previous close of 6.9160.
"We're firmer - it started as the rand went down to the lower levels. The news was expected, guys are going through the speech to see if it was dovish or hawkish," said a local trader.
Notably, Governor Gill Marcus said the decision to keep rates on hold was unanimous, with no calls being made from the Committee for either an increase or a decrease in rates.
She refused to be drawn on speculating on whether rates would increase in the second half of the year, but did lift inflation forecasts upwards by half a percentage point for 2011 and 2012 in light of higher projected oil prices.
Interest rates remain at their lowest level in nominal terms in almost 30 years.
The repo rate was unanimously expected to remain unchanged according to a survey of leading economists by I-Net Bridge.
Rates were cut by 50 basis points to 5.5% for the repo rate in November and 9.0% for the prime rate.
Foreigners were net buyers of R79.761m of South African bonds including repo transactions on Wednesday after net purchases of R1.778bn of local bonds on Tuesday, Bond Exchange of South Africa statistics show.
Nominal cumulative volume was R70.434bn on Wednesday from R185.104bn on Tuesday.
Foreigners were net buyers of R91.173m of South African bonds excluding repo transactions on Wednesday after net purchases of R1.734bn of local bonds on Tuesday.
For the year to date, foreigners have been net sellers of R13.990bn worth of local bonds, excluding repo transactions. In 2010 foreigners bought net R57.064bn worth of local bonds, excluding repo transactions.
For the year to date for total transactions, including repo transactions, foreigners have been net sellers of R16.368bn of local bonds. In 2010 they bought net R44.541bn worth of bonds.
