South Africa 10-Year Bond Yield at 9-Month High

South Africa's 10-year government bond yield climbed to 10.75%, the highest level since early June 2024, amidst fiscal policy concerns and global economic uncertainties.

South Africa’s new Government of National Unity (GNU) failed to present its first budget last month, postponed for the first time in its post-Apartheid history, after the DA and other members of the 10-party coalition opposed a proposed 2% increase in the value-added tax (VAT) rate.

The global context surrounding South Africa’s budget this week is significantly different from less than a month ago, when it was delayed, with US President Donald Trump's pullback of $1.4 billion in funding and escalating trade tensions.

Meanwhile, South Africa avoided a technical recession in the last quarter of 2024, expanding by 0.6%, but economic growth remains too weak to tackle structural challenges.