Reserve Bank of South Africa

Bonds Extend Rally Ahead of Linker Auction

JOHANNESBURG (Capital Markets in Africa) – South Africa’s 10-year government bonds rose for a fourth day, set for the longest winning streak in two months, ahead of National Treasury’s inflation-linked bond auction, scheduled later Friday. The rand weakened against the dollar, broadly in line with other emerging-market currencies. National Treasury plans to sell 900m rand ($63.4 million) across inflation-linked bonds maturing in 2029, 2033 and 2050. This is the first linker auction with an increased issuance size,…

Investec First-Half Profit Climbs 21% as Funds Increase

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JOHANNESBURG Capital Markets in Africa) – Investec Plc, which owns a lender and money manager in South Africa and the U.K., said fiscal first-half profit rose 21 percent as funds under management increased, equity markets rose and the banking business increased lending. Net income climbed to 252.4 million pounds ($332 million) in the six months ended Sept. 30 from 208.6 million pounds a year earlier, the London- and Johannesburg-based lender said in a statement on Thursday. The dividend…

South Africa Treasury Seeks Funding Plan to Boost Eskom’s Liquidity

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JOHANNESBURG (Capital Markets in Africa) – South Africa’s Treasury is identifying ways to boost liquidity at the embattled state-owned power utility as its cash reserves slide due to below-target revenue. The National Treasury is concerned about Eskom Holdings SOC Ltd.’s “current financial position and has been working closely with the Department of Public Enterprises and Eskom to address the issues that are impacting the entity’s liquidity position,” the ministry said an emailed response to questions on…

South Africa September Inflation Uptick Limits Room for Rate Cuts

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JOHANNESBURG (Capital Markets in Africa) – South African inflation quickened for a second consecutive month in September, reducing room for the nation’s central bank to ease policy. The inflation rate rose to 5.1 percent from 4.8 percent the previous month, Pretoria-based Statistics South Africa said in a report on its website on Wednesday. The median of 24 economist’s estimates in a Bloomberg survey was 5 percent. Prices rose 0.5 percent in the month, the highest monthly rate since March….

South Africa’s Mminele Downplays Chance of Imminent Rate Cuts

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JOHANNESBURG (Capital Markets in Africa) – Uncertainty limits the opportunity for rate cuts in South Africa even as inflation remains within the central bank’s target band, according to Deputy Governor Daniel Mminele. The bank unexpectedly kept its key rate unchanged at 6.75 percent at its last policy meeting in September, concerned about higher inflation expectations. Price growth quickened to 4.8 percent in August, its fifth month within the central bank’s target range of 3 percent to 6 percent. “Amid…

Weak South Africa Growth May Allow for Lower Rate, Bank Says

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JOHANNESBURG (Capital Markets in Africa) – South Africa’s weak economic growth may provide some scope for lower interest rates, the central bank said. “With near-zero growth and a negative output gap, there is some limited scope for lower interest rates to have positive counter-cyclical effects,” the South African Reserve Bank said in its Monetary Policy Review Wednesday. The central bank left its key rate unchanged at 6.75 percent on Sept. 22 as it assessed risks to the rand…

The Reason Why South Africa’s Central Bank May Cut Again This Week

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JOHANNESBURG (Capital Markets in Africa) – If South Africa’s central bank cuts interest rates again this week, just don’t accuse it of doing so for the sake of “socioeconomic well-being.” The institution has been fighting off a bid by the nation’s anti-graft ombudsman to change its mandate away from targeting inflation to focusing on the financial health and quality of life of its citizens. But officials might be about to deliver their second rate reduction this…

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