Wednesday, 18 July 2012 12:32
JOHANNESBURG: South African government bond yields tracked lower on Wednesday, pushed down by more offshore buying and domestic market expectations of a moderation in inflation that may allow the central bank room to cut interest rates this year.
The rand was slightly weaker at 8.1872/dolar at 0630 GMT compared to a 8.1685 close in New York, and dealers said it would trade in a 8.16-8.24 range ahead of a central bank interest rate decision on Thursday.
The yield on the benchmark 2026 bond dropped to 7.41 percent, its lowest since January 2009, while the three-year and nine-year bonds were close to Tuesday's record lows at 5.68 percent and 6.765 percent respectively.
The yield differential between the two benchmarks - the R186/R157 spread - narrowed to 170 basis points, levels last seen two months ago, as offshore pension funds showed a preference for the higher-yielding back end of the curve.
Adding to the rally in ...