* Retail sales plunge in April, off high base
* Bonds boosted by weak data but long end pressured
* Rand turns firmer as euro hits session high vs dollar
JOHANNESBURG, June 13 (Reuters) – Yields on South African
government bonds were down as bonds benefited from soft retail
data on Wednesday with the three-year bond yield hitting a fresh
record low.
However the longer end remains under over-supply pressure as
investors anticipate 10 billion rand ($1.20 billion) to be put
into the back end of the curve at an auction on Thursday.
Retail sales growth was at a meagre 1 percent in April,
compared to 6.7 percent in March and economists’ expectations of
4.5 percent, partly because of a high base set in April last
year.
The weak number is likely to see second quarter growth
moderate but analysts say the data is not enough to prompt the
central bank to cut interest rates just yet.
The yield on the three-year bond closed five basis
points lower at 6.17 percent while the 14-year bond
ended 2.5 basis points down at 8.26 percent.
“SAGB’s were up to four basis points lower in some places of
the yield curve, particularly the front end as bonds benefited
from the soft data that could hint at a rate easing further
out,” said Anisha Arora from 4Cast.
Continued…
