Foreigners buy South African bonds at a rate not seen in years

[James]

Foreign investors bought the most South African government bonds in more than two years on Thursday, attracted by yields among the highest in emerging markets as the Federal Reserve gets closer to cutting interest rates.

Non-residents bought a net R4.6 billion ($256 million) of the securities, the most in a day since January 2022, according to JSE data compiled by Bloomberg.

 

That capped eight days of net buying by foreigners, the longest streak in more than seven years.

Investors are showing renewed interest in South Africa’s bonds after the May 29 election, when the African National Congress lost its parliamentary majority. That forced it to invite opposition parties into government, including the business-friendly Democratic Alliance, which drew the second-most votes.

 

Investors are wagering that the presence of opposition parties may help the new administration tackle state ineptitude, power shortages and logistics snarl-ups that have hobbled economic growth. The rand is the best-performing developing currency since the election, while South African stocks are at record highs.

 

Read the full article here: https://www.moneyweb.co.za/news/markets/foreigners-buy-south-african-bonds-at-a-rate-not-seen-in-years/