South African bonds were mostly firmer in late trade on Wednesday. But a local trader said the curve had steepened after the auction announcement in which the National Treasury said it would auction R500m worth of R203 bonds and 1.6 billion rand worth of R186 bonds at its weekly auction on February 15.
By 15:50, the benchmark R157 bond was trading at 7.450% from its previous close of 7.850%, while the R207 was bid at 8.490% from its previous close of 8.500%. The R186 was trading at 8.680% from 8.640%.
The rand was bid at 7.2053 to the dollar from its previous close of 7.1704.
"The market did not anticipate another auction of longer-dated bonds given how poorly the R213s did in the last auction. The shorter-end is a bit firmer -
the currency seems to be coming back a little," said a local bond trader.
Foreigners were net buyers of R2.176bn rand of South African bonds including repo transactions on Tuesday, after net sales of R1.034bn of local bonds on Monday, Bond Exchange of South Africa statistics show.
Nominal cumulative volume was R171.618bn on Tuesday and R54.420bn on Monday.
Foreigners were net buyers of R2.022bn of South African bonds excluding repo transactions on Tuesday after net sales of R1.016bn of local bonds on Monday.
For the year to date, foreigners have been net sellers of R7.407bn worth of local bonds, excluding repo transactions. In 2010 foreigners bought net R57.064bn worth of local bonds, excluding repo transactions.
For the year to date for total transactions, including repo transactions, foreigners have been net sellers of R3.400bn of local bonds. In 2010 they bought net R44.541bn worth of bonds.
