JOHANNESBURG: South African government bonds eased on Tuesday after weakening on the longer end of the yield curve in the previous session and the rand softened on hopes of ending a mine strike that has sparked labour unrest in the platinum belt.
The bond yields for the 2026 paper moved up 1.5 basis points to 7.620 percent and one basis points on the 2015 note.
"If the rand continues to lose a bit of ground, yields will probably tick up a bit," said Ion de Vleeschauwer, a trader at Bidvest Bank in Johannesburg.
"But there is still demand for our bonds. I don't expect massive weakness in the bonds, but a little bit of an up-tick in the yields is probably in the cards."
Treasury will sell a total of 2.1 billion rand ($256 million) over a range of its 2023, 2041 and 2048 government bonds in the session. Results are due after the auction closes at 0900 GMT.
The rand was at 8.2431 against the dollar at 0658 GMT, after opening at 8.2690, a touch softer than Monday's New York close of 8.2350.
"The 8.20 level seems to be very difficult for the rand to break.
There are lots of people wanting to buy dollars now, so that's stopping the rand from strengthening further," De Vleeschauwer said.
Investors have been encouraged by news strikers at Lonmin's Marikana mine in South Africa have cut their basic wage demand to try to end a six-week strike that halted platinum output at the world's third-largest producer.
At 0930 GMT, Statistics South Africa will release its Q2 quarterly employment data, including jobs statistics for the formal non-agricultural sector.
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