Bonds perk up on rand

Johannesburg - Bonds were roused from their slumber in the afternoon on Friday after the rand found a jolt of energy below the R8.30 mark.

By 15:45 the short-term government R153 bond was bid at 6.360% from its previous close of 6.355%. The medium-term R157 was at 8.130% from a previous close of 8.135%, while the long-term R186 was at 8.640% from 8.655% before.

The rand was last at R8.2475 to the dollar from a previous close of R8.3190.

"We have strengthened during the afternoon on the rand," said a local bond dealer.

Another local bond dealer noted that the market would remain rand-centric for the time being. The dealer feels that another spark will come next week when the raft of local economic data - including GDP, the repo and CPI - is released.

The first key release comes on Tuesday in the form of GDP.

A recession in South Africa is expected to be confirmed via a GDP growth rate of -3.9% quarter-on-quarter (q/q) seasonally adjusted annualised (saa) from -1.8% in the fourth quarter of last year, according to a consensus of 10 leading economists by I-Net Bridge.

Foreigners were net buyers of R649.093m worth of bonds including repo transactions on Thursday after net sales of R563.054m worth of local bonds on Wednesday, Bond Exchange of South Africa statistics show.

Nominal cumulative volume was R14.806bn on Thursday from R26.866bn on Wednesday.

Foreigners were net buyers of R683.380m worth of bonds, excluding repo transactions, on Thursday after net sales of R498.264m worth of local bonds on Wednesday.

On a year to date basis, foreigners have been net buyers of R12.219bn worth of local bonds, excluding repo transactions.

On a year to date basis for total transactions, including repo transactions, foreigners have been net sellers of R15.158bn.

- I-Net Bridge