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Johannesburg - South African bonds were mostly
firmer in midday trade on Tuesday, which a trader said was on the back
of the lower than anticipated GDP figure. The R186s were a touch weaker.
Stats SA said SA's real gross domestic product (GDP) at market prices on a quarter-on-quarter (q/q) seasonally adjusted annualised (saa) basis rose by 1.4% in the third quarter of 2011 from 1.3% in the second quarter.
By 11:50, the benchmark R157 bond was trading at 6.955% from its previous close of 6.980%. The R207 was bid at 8.045% and offered at 8.035% from a previous close of 8.060% and the R186 was trading at 8.620% from its close of 8.615%.
The rand was bid at 8.3470 against the dollar from its previous close of 8.3723.
"We're just a touch firmer on GDP numbers here - nothing much trading at the moment; it went quiet after the auction - which was okay, it basically cleared at market. We started seeing bids coming back after GDP, but it's very quiet now," a local trader said.
Standard Bank's Thabi Leoka said the combination of slow GDP growth and upward pressure on domestic inflation driven by exogenous factors presented a difficult scenario for monetary policy.
"Monetary policy makers have to be cautious that steps taken to contain inflation are not premature and risk further slowing in growth. FRA markets are pricing in a rate hike only in 2013," the economist said.
Annabel Bishop, economist at Investec said: "We continue to expect no cut in interest rates in 2012, but a further weakening in the growth outlook would cause us to change our view to a 50 basis point easing."
At its weekly auction, the National Treasury received bids totalling 3.44 billion rand for R1 billion worth of R186 bonds at a clearing yield of 8.640% and bids totalling 2.24 billion rand for R213 bonds at a clearing yield of 9.00%.
Foreigners were net buyers of R330.365 million of South African bonds including repo transactions on Monday after net sales of R665.715 million of local bonds on Friday, data released by the JSE shows.
Nominal cumulative volume was R66.061 billion on Monday from R72.207 billion on Friday.
Foreigners were net buyers of R327.990 million of South African bonds excluding repo transactions on Monday after net sales of R665.963 million of local bonds on Friday.
For the year to date, foreigners have been net buyers of R44.848 billion worth of local bonds, excluding repo transactions.
In 2010 foreigners bought net R57.064 billion rand worth of local bonds, excluding repo transactions.
For the year to date for total transactions, including repo transactions, foreigners have been net buyers of R35.370 billion of local bonds. In 2010 they bought net R44.541 billion worth of bonds.
Stats SA said SA's real gross domestic product (GDP) at market prices on a quarter-on-quarter (q/q) seasonally adjusted annualised (saa) basis rose by 1.4% in the third quarter of 2011 from 1.3% in the second quarter.
By 11:50, the benchmark R157 bond was trading at 6.955% from its previous close of 6.980%. The R207 was bid at 8.045% and offered at 8.035% from a previous close of 8.060% and the R186 was trading at 8.620% from its close of 8.615%.
The rand was bid at 8.3470 against the dollar from its previous close of 8.3723.
"We're just a touch firmer on GDP numbers here - nothing much trading at the moment; it went quiet after the auction - which was okay, it basically cleared at market. We started seeing bids coming back after GDP, but it's very quiet now," a local trader said.
Standard Bank's Thabi Leoka said the combination of slow GDP growth and upward pressure on domestic inflation driven by exogenous factors presented a difficult scenario for monetary policy.
"Monetary policy makers have to be cautious that steps taken to contain inflation are not premature and risk further slowing in growth. FRA markets are pricing in a rate hike only in 2013," the economist said.
Annabel Bishop, economist at Investec said: "We continue to expect no cut in interest rates in 2012, but a further weakening in the growth outlook would cause us to change our view to a 50 basis point easing."
At its weekly auction, the National Treasury received bids totalling 3.44 billion rand for R1 billion worth of R186 bonds at a clearing yield of 8.640% and bids totalling 2.24 billion rand for R213 bonds at a clearing yield of 9.00%.
Foreigners were net buyers of R330.365 million of South African bonds including repo transactions on Monday after net sales of R665.715 million of local bonds on Friday, data released by the JSE shows.
Nominal cumulative volume was R66.061 billion on Monday from R72.207 billion on Friday.
Foreigners were net buyers of R327.990 million of South African bonds excluding repo transactions on Monday after net sales of R665.963 million of local bonds on Friday.
For the year to date, foreigners have been net buyers of R44.848 billion worth of local bonds, excluding repo transactions.
In 2010 foreigners bought net R57.064 billion rand worth of local bonds, excluding repo transactions.
For the year to date for total transactions, including repo transactions, foreigners have been net buyers of R35.370 billion of local bonds. In 2010 they bought net R44.541 billion worth of bonds.
