South African bonds were a tad firmer in quiet early trade on Monday in what is likely to be a quiet week for local economic data.
South African bonds were a tad firmer in quiet early trade on Monday in what is likely to be a quiet week for local economic data.
By 08:45 the benchmark R157 bond was at 7.130% from its close of 7.140% on Friday, while the R207 was bid at 7.855% and offered at 7.825% from 7.850% at its previous close. The R186 was bid at 8.005% and offered at 7.975% after closing at 8.000%.
The rand was bid at 6.8859 to the dollar from its previous close of 6.8070.
Local markets will this week be moved more by data from the US and Euro-zone, as there is not much market moving economic data from home.
Only a few data releases are due – building stats on Wednesday and civil cases for debt on Thursday.
AbsaCapital analysts said in their morning report that they expect the private sector building statistics to continue to reflect a weak fixed investment environment, especially on the residential construction front.
Civil summonses issued with respect to private persons in the first seven months of the year were down almost 3% from the year-earlier period, while those for businesses rose only 0.6%. Overall, civil summonses for debt during the first seven months of 2010 fell 2.5% from a year earlier, while the increase in civil judgements for debt slowed to 2.1% y/y in the first seven months of 2010 from 6% over the year-earlier period, they pointed out.
"Significant monetary policy easing since December 2008 has reduced household debt-servicing costs from more than 12% of disposable income at the end of 2008 to about 8% in Q2 10, which together with growing disposable incomes, has made life a little easier for households. In our view, these
factors have contributed to a decline in civil summonses for debt and should continue to filter into the data for August," they said.
Foreigners were net sellers of R742.714m of South African bonds including repo transactions on Friday after net purchases of R1.011bn of local bonds on Thursday, Bond Exchange of South Africa statistics show.
Nominal cumulative volume was R49.061bn on Friday from R58.722bn on Thursday.
Foreigners were net sellers of R337.184m of South African bonds excluding repo transactions on Friday after net purchases of R1.041bn of local bonds on Thursday.
In the year to date foreigners have been net buyers of R72.829bn
worth of local bonds, excluding repo transactions.
So far for total transactions, including repo transactions, foreigners have been net buyers of R64.420bn worth of bonds.
In 2009 foreigners were net buyers of R27.755bn worth of local bonds, excluding repo transactions, while for total transactions, including repo transactions, foreigners were net sellers of 3.3 billion rand worth of bonds.
