South Africa’s economy turns the corner, yields hit 2-year low

Oct. 1, 2024 - Businessday

South Africa’s benchmark bond yield fell below 10% for the first time in more than 2 years as the nation’s deputy president amplified growing confidence that the continent’s biggest economy is turning a corner. “We think that by next year we could be growing about 1.

5%,” Paul Mashatile said in an interview with Bloomberg Television in London. The currency and equity rallies reflect growing confidence in South Africa’s fiscal policies, particularly as the new coalition government, which took power in June, shows a commitment to economic reform and fiscal discipline.

“We are shifting more resources to economic activity,” said Mashatile, who’s leading an investor roadshow in the UK this week. Goldman Sachs strategists, including Kevin Daly, have noted that South Africa’s fiscal policies are likely to remain on track, suggesting that bond yields may continue to trend lower as the coalition government focuses on restoring credibility.

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