Africa Bonds

Ghana has bought back $200m of its outstanding 8.5% 2017s — just half of the targeted $400m. Emerging markets investors were happy to hold the bonds to maturity, said one on Monday.

Emerging market bonds opened 10bp-15bp wider on Monday giving issuers plenty of reason to sit and digest a sell-off following a months-long positive run. However, bankers said that more attractive valuations would be a positive for investors.

Ghana stunned bond markets with a new six year dollar deal yielding 9.25% on Thursday, barely a month after abandoning issuance plans due to pricing concerns.

South African telecoms company MTN will start meeting investors this week ahead of a potential dollar bond market return.

Ghana took investors by surprise on Thursday morning with the release of pricing for a new global dollar bond.

Domestic opposition could derail Egypt’s IMF deal and threaten plans for a dollar market return, analysts have warned.

South Africa was thrown into financial uncertainty this week as its finance minister, Pravin Gordhan, became embroiled in a corruption probe by the country’s elite police unit, the Hawks. Volatility hit local currency bonds, which remain some 50bp wider, but the country’s sovereign curve is already recovering and in equities and loans it is business as usual. But some say this underplays the risk of investing in South African assets.

South African president Jacob Zuma has spoken out in support of the country's troubled finance minister, Pravin Gordhan, but this did little to reassure the market as volatility in local currency bonds and the rand extended into Thursday.

South Africa’s dollar debt had dropped up to two cash points on Wednesday after reports that the country’s finance minister could be charged with an offence rocked the market. While investors are concerned, the relentless bid for EM assets contained the sell-off, an EM banker said.

Activity is ramping up in emerging markets with several mandates coming through this week. While the unrelenting buying of the asset class continues, idiosyncratic risks are a reminder of the volatility that can arise.

Egypt has picked four international banks to manage its upcoming bond sale as it awaits approval on a $12bn extended fund facility (EFF) from the IMF’s executive board.

Egypt has picked four international banks to manage its upcoming bond sale as it awaits approval on a $12bn extended fund facility (EFF) from the IMF’s executive board.