JOHANNESBURG, April 17 (Reuters) – The rand leapt and South African government bond yields logged their steepest drop in nearly three years on Tuesday as news that local debt could be included in Citigroup’s main global bond index boosted demand from local and foreign accounts.

The rand jumped more than 1.8 percent against the dollar, performing the best among 20 emerging market currencies on the view that inclusion in Citigroup’s World Government Bond Index could trigger billions of dollars worth of portfolio flows.

The yield on the 2026 issue fell as much as 30.5 basis points, the sharpest one-day fall since May 2009, before coming back to 8.155 percent by the close, down 24 basis points from Monday’s level.

The yield on the three-year benchmark tumbled 21 basis points to 6.51 percent.

Citi said South Africa was currently in a three-month “monitoring period” to make sure it continued to meet index entry requirements to the WGBI. These are based on issue size, ease of entry and credit rating, all of which were passed in April.

“If you are included into that index it will mean South African bonds will need to be bought for guys tracking that index, especially areas of the yield curve near the likely duration of that index, determined at round about 10 years,” said Marten Banninga, head of bond trading at WWC Securities.

“So any bond which is in close vicinity of that maturity will be bought more aggressively. It does indicate that your 186 bond is going to be one of your favourites because it suits the criteria,” Banninga added, warning however that Tuesday’s rally might have been overdone and not sustainable.

JOHANNESBURG, March 29 (Reuters) – South Africa’s Reserve Bank left its repo rate unchanged on Thursday, saying the risks to the inflation outlook were evenly balanced and reaffirming its commitment to supporting the still-fragile economy.

But the Bank’s monetary policy committee needs to be more vigilant on inflation amid signs that price pressures are becoming more broad-based, Governor Gill Marcus told a press conference.

“The current stance of monetary policy is appropriate to support the real economy while at the same time maintaining its commitment to achieve the inflation target over the medium term,” Marcus said, keeping the repo rate at 5.5 percent.

The rand extended losses against the dollar to nearly one percent soon after the announcement, but government bonds were barely changed.

All 24 economists polled by Reuters last week expected the Bank’s Monetary Policy Committee to keep the repo rate, at which it lends to commercial banks, at three-decade lows. Twelve economists saw no change throughout 2012.

The central bank has kept rates unchanged for 16 months after cutting them by 650 basis points in total to 30-year lows over a two-year loosening cycle that ended in November 2010.

Inflation was still expected to peak in the second quarter of 2012 but at a slightly lower level of 6.5 percent from the 6.6 percent forecast before, Marcus said, striking a more dovish tone than earlier this month when she warned inflation was becoming more generalised.

PRETORIA (Reuters) – African powers Angola, Nigeria and South Africa on Friday endorsed the nomination of Nigerian Finance Minister Ngozi Okonjo-Iweala, a respected economist and diplomat, as a candidate to take over the World Bank.

The United States faces an unprecedented challenge to its grip on the World Bank presidency, with emerging economies poised to nominate at least one candidate on Friday to set up the first contested bid for the top job at the global development lender.

“The endorsement is in line with the belief that the appointment of the leadership of the World Bank and its sister institution, the International Monetary Fund, should be merit-based, open and transparent,” the three said in a statement.

South Africa chairs one of the three African seats on the 25-member World Bank board, and earlier this week sources said Okonjo-Iweala’s candidacy was being proposed after consultations between South Africa’s President Jacob Zuma and Nigeria’s President Goodluck Jonathan.

The joint endorsement is a rare bit of unity among the three countries often at loggerheads as they battle for dominance on the continent.

“She has eminent academic qualifications and would be, I think, a candidate of choice not only on the African continent but well beyond as well,” South Africa’s Finance Minister Pravin Gordhan told a media briefing on Friday.

The three countries will lobby other African states to endorse her, Gordhan added.

CAPE TOWN, 22 (Reuters) – South Africa projected a lower-than-expected 2012/13 budget deficit on Wednesday, reassuring bond investors and ratings agencies that the continent’s biggest economy is keeping a lid on spending despite huge social pressures and sluggish growth.

Presenting the third budget of President Jacob Zuma’s administration, finance minister Pravin Gordhan said spending would exceed revenues by 153 billion rand ($19.9 billion), or 4.6 percent of gross domestic product (GDP).

The shortfall is a slight improvement on 4.8 percent in this financial year and sharply lower than the 5.4 percent economists had been expecting, given a push by leftist factions of the ruling ANC to boost the safety net for South Africa’s legions of poor.

After the loss of a million jobs in a 2009 recession, one in three of the country’s 50 million people are on some form of benefits.

“South Africa’s finances are in good shape,” Gordhan told parliament in Cape Town, in a thinly veiled dig at the two ratings agencies that have cut its credit outlook in the last three months, mainly due to fears about the effects of a slowdown in Europe and the United States.

Despite his confidence, the economic crisis in Europe - South Africa’s main trading partner – forced Gordhan to cut his economic growth forecast for this year to 2.7 percent from a projection of 3.4 percent outlined in October.

The reduction brings the government into line with the central bank and International Monetary Fund (IMF), but it also shows how far South Africa is from the 7 percent growth deemed necessary to make a dent in unemployment that refuses to drop much below 25 percent.

JOHANNESBURG, Feb 21 (Reuters) – Lucas Netshiavha feels resentful whenever he sees the slice of his salary taken by South Africa’s taxman, since – so he believes – a large chunk will end up in the pockets of corrupt politicians or be washed down the drain of state mismanagement.

“I wouldn’t mind so much if my ‘donation’ was properly spent on education, medicine in hospitals or to help my grandmother back in my home village, but I have serious doubts that’s happening,” the IT specialist said.

Netshiavha is well paid, but his pay packet is split between his widowed mother and two siblings, and his fears of wasted taxes and creeping corruption under President Jacob Zuma are not unfounded.

Since he came to office in 2009, Zuma has come under fire for what many see as a failure to crack down on officials implicated in misappropriating billions of dollars in state funds.

“Corruption is the bane of our country,” IFP opposition leader Mangosuthu Buthelezi told Zuma during a debate in parliament last week. “Yet, sir, you shy away from this issue.”

Despite raking in over 600 billion rand ($78 billion) in taxes each year, Finance Minister Pravin Gordhan is likely to announce a budget deficit of more than 5 percent on Wednesday to fund social services and infrastructure spending.

However, the many schools without books and hospitals short of medicines, not to mention a lack of houses and sanitation for millions of South Africans 18 years after the end of apartheid, suggest much of the money is not getting through.

PRETORIA, Nov 10 (Reuters) – South Africa’s Reserve Bank held interest rates on Thursday, choosing to focus on rising inflationary pressures in preference to propping up a sluggish domestic economy as uncertainties clouded the country’s future rate path.

The Bank’s 7-member monetary policy committee discussed a cut but agreed that keeping the repo rate at a three-decade low of 5.5 percent was appropriate, Governor Gill Marcus told a news conference.

Marcus said the economic recovery remained hesitant but inflation was a concern, while the worsening global outlook and the euro zone debt crisis made for an unclear environment for emerging market investments.

“Certainly there was discussion about whether a rate cut was appropriate at this point… On balance, we felt it was appropriate to hold given all of the issues that are prevailing,” Marcus said.

“So (there was) a unanimous decision on hold, but certainly a strong consideration whether we should cut or not.”

The majority of 26 economists polled by Reuters last Friday saw the rate holding steady, with just two expecting a 50 basis point cut to a new all-time low of 5.0 percent.

Rising costs of imports would likely drive annual consumer price inflation above the upper end of the bank’s 3-6 percent target range in the final quarter of 2011, and inflation would peak at 6.3 percent in the first quarter of 2012, slightly higher than the 6.2 percent seen in September, the bank said.

JOHANNESBURG, Aug 18 (Reuters) – South African benchmark stocks booked their biggest daily decline in more than 15 months on Thursday, tracking equity losses elsewhere on resurgent worries about the global economy which also hit the rand.

Government bonds however triumphed and the yield on the 4-year issue fell as much as 12 basis points to a new all-time low of 6.67 percent as foreign investors continued to snap up local debt, attracted by yields which compare favourably with those in developed countries.

The yield on the longer-dated 2026 bond was at 7.995 percent, down 15.5 basis points from Wednesday’s close.

The JSE Top-40 blue-chip index fell 3.37 percent to 26,030.31, suffering its biggest daily decline since May last year. The broader All-share index surrendered 2.95 percent to 29,288.86.

“Two things drove the market today: global growth concerns and funding problems in Europe,” said Ian Louw, a trader at Vunani Securities.

Renewed worries about Europe’s debt crisis and a raft of weak U.S. economic data hit global markets on Thursday, driving down stocks and oil prices and pushing U.S. bond yields to record lows while pushing gold to a record high.

Dimmer prospects for global growth are creating an uncertain environment for the local economy, Finance Minister Pravin Gordhan said on Thursday.

JOHANNESBURG, Aug 15 (Reuters) – South Africa’s rand relinquished some of its earlier gains against the dollar on Monday but was higher on the day, buoyed by foreign demand for high yielding local debt which helped offset lingering concerns over the global economy.

Stocks rose for a fourth day running, tracking a global rally, although gold producer Harmony dropped after its quarterly profit missed forecasts.

The JSE Top-40 index of blue-chips gained 1.21 percent to 26,947.78 and the broader All-share index lost 1.12 percent 30,159.42.

Foreigners bought a net 1.2 billion rand of South African bonds last week, data from the JSE exchange showed, and demand remained strong on Monday, pushing the yield on the four-year note 7.5 basis points lower to 6.935 percent.

The yield for 2026 issue fell 4.5 basis points to 8.33 percent.

By 1542 GMT the rand traded at 7.1195 to the greenback, off a session high of 7.09 but 0.77 percent stronger than Friday’s close.

“We saw quite a lot of local asset managers buying dollars today but there was a lot of supply coming from offshore … mostly bond-buying,” Standard Bank trader Warrick Butler said.

JOHANNESBURG, Aug 12 (Reuters) – South Africa’s rand steadied against the dollar on Friday but faced further losses after a turbulent week in which it hit its weakest levels in more than a year as investors spooked by debt woes in the U.S. and Europe fled to safer havens like the yen.

Government bonds also took a breather after demand rose sharply earlier in the week as market players pushed out their expectations for a domestic rate rise to mid-2012 on a dimmer outlook for the global and South African economy.

South Africa’s broad-based stocks index rose over 1 percent on Friday, led by retailers such as Mr. Price , which were bolstered by U.S. retail sales’ biggest gain in three months in July.

The rand was at 7.18 to the dollar by 1550 GMT, off its weakest level of the day of 7.29 and up 0.21 percent from Thursday’s close.

The currency was set to close the week about 4 percent weaker than the greenback after a heavy global sell-off triggered by S&P’s downgrade of U.S. debt.

“For next week, a lot still depends on what’s going to happen in the U.S. and Europe,” said Paul Chakaduka, a trader at Global Trader.

“What’s worrying at the moment is that gold has pulled back a long way from its highs and that doesn’t bode well for the rand. But at the same time we’re seeing equity markets pushing higher … and that should have a positive impact on the currency. I would say it could trade from around 7.25 to 7.00.”

JOHANNESBURG, Aug 11 (Reuters) – South African stocks added more than 3 percent on Thursday, the biggest daily percentage increase in 15 months, boosted by sentiment generated by better-than-expected U.S. labour market data.

The rand recouped earlier losses against the dollar, largely tracking a firmer euro, but remained vulnerable to market volatility linked to global financial worries which have cast a pall on the outlook for the domestic economy.

Government bonds fell, giving back some of the previous day’s strong gains which were prompted by traders pushing out their expectations of interest rates rises to mid next year on signs growth is stalling in Africa’s biggest economy.

At the bourse, the benchmark Top-40 index added 3.3 percent to 26,297.69, the highest daily increase since May 2010. It has fallen nearly 6 percent this month. The broad-based All Share index added 2.9 percent to 29,490.20 on Thursday.

The banking index surged more than 4 percent and Standard Bank , Africa’s biggest lender by assets, gained 4.4 percent to 94.50 rand after reporting a surprise 11 percent rise in half-year earnings.

Resource firms such as Kumba Iron also benefited from the rally. It ended nearly 6 percent up at 499.00 rand.

Gold miner Gold Fields surged 4.9 percent to 118.00 rand, riding on record bullion prices and after reporting second quarter profits jumped 15 percent.