South Africa Bond Market (Quarterly Report) - April 2015

Bond yields have generally drifted lower between mid-2014 and the first quarter of 2015, with the ALBI return spiking at 21% in January this year. However, ratings agencies have mostly downgraded the credit risk ratings of SA bonds. Bigger counter-cyclical and infrastructure spending by government over the next few years will mean further pressure on the borrowing requirement as a percentage of GDP, which could spell a negative impact on bond returns.

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