Bonds softer in line with embattled rand

Bonds were weaker at midday on Monday‚ although firmer than they had been earlier‚ as the rand touched a new weakest level amid global risk aversion.

Concern about global growth soured investor sentiment and riskier assets such as the rand bore the brunt of it.

At 11.28am‚ the benchmark R186 was bid at 9.670% and offered at 9.600% from a Friday close of 9.515%.

The middle-dated R207 was bid at 9.130% and offered at 9.125% from a Friday close of 8.955%.

Barclays Research analysts said the rand had recouped most of the losses it made early on Monday morning‚ but remained vulnerable to poor domestic sentiment and global factors.

The rand had weakened sharply by 9% in the early hours of Monday morning to R17.91 to the greenback in illiquid trade‚ the analysts said.

They said yield-hungry Japanese retail investors seemed to have decided to cut their rand positions on Monday morning and this had triggered a number of stop losses and sent the currency into freefall.

By 11.26am‚ the rand managed to recover to trade at R16.4823 to the dollar‚ from a close of R16.3009 on Friday.

- TMG Digital/BDlive