South Africa 10-Year Bond Yield Continues Downtrend

2025-12-17 10:42 By Luisa Carvalho 1 min. read

South Africa’s 10-year government bond yield eased further toward 8.35%, holding close to 2020-lows, as a more benign inflation outlook raised expectations of further rate cuts next year.

South Africa's headline inflation rate eased to 3.5% in November, from 3.6% in October, against market forecasts of 3.6%, moving closer to the new SARB's 3% inflation target.

Moreover, short-term inflation expectations fell to record lows in Q4, opening the door for a potential rate cut on January 29.

South African bonds have surged in recent months, with yields falling sharply in one of the strongest rallies since the pandemic ended.

The quarterly bulletin from the Reserve Bank cited stable local consumer prices, repo rate cuts, a firmer rand, and reduced international trade tariff uncertainty as key drivers of the decline.

The market-friendly mid-term budget update and the country’s removal from FATF greylist added to the positive mood.



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