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SAGBs Get Choppy Into the Weekend, Focus Shifts to Nail-Biter SARB Meeting

SOUTH AFRICA
  • SAGBs trade a fraction firmer at the open with 30Y yields holding -2bp lower with price action managing to hold below the 10.50 handle.
  • Friday's session saw some choppy price action at the back end of the curve as bulls and bears battled it out post-MTBPS with the 10Y trading in a 26bp range on the day.
  • W/w the SAGB curve closed marginally bear flatter with duration pulling back some of the gains made after the MTBPS.
  • 10-30Y yields remain in limbo, awaiting more decisive price action before determining a near-term direction.
  • This week's SARB is expected to be a nail-biter with a +25bp hike fully priced into the 1x4 FRA-Jibar spread.
  • We remain of the opinion that the SARB will not hike until 2022, which may see the front end pivot lower post-decision.

MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com

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