Rand gains as yields fall to two-week low
The mining-stability agreement, brokered by Deputy President Kgalema Motlanthe, was concluded on June 28 and will be signed tomorrow, government spokesperson Thabo Masebe said on Monday.
The pact is meant to eliminate intimidation, labour violence and unprotected strikes at mines, which contributed to the rand’s 14% slide this year, Motlanthe said on June 21.
“Any formalised agreement would be seen as a positive sign for the sector,” said Kuvasha Naidoo and Asher Lipson, fixed-income analysts at Standard Bank Group in Johannesburg. Mining accounts for more than half of South Africa’s exports.
South Africa’s currency gained 0.4% to R9.9863 per dollar as of 10:04am in Johannesburg. Yields on benchmark 10.5% bonds due December 2026 dropped three basis points, or 0.03 percentage points, to 7.88%, the lowest since June 17. The yield has declined 44 basis points in the past six trading days.
Foreign investors bought a net R1.26-billion of South African bonds yesterday, adding to R445-million of purchases last week, according to data from the JSE. – Bloomberg