The Taquanta SNN Bond Fund will change it's name to Taquanta Bond FR Fund, effective from 07 September 2023

On the 15th of December, the U.S. Federal Reserve Bank hiked interest-rates by 50 basis-points (bps), raising the target range to a lower and upper bound of 4.25% and 4.50%, respectively. While the outcome was broadly in line with our and the analysts’ consensus estimates, forward guidance revealed a rather surprisingly hawkish undertone. The Fed signalled that tightening would continue and culminate at a level above market expectations. Both the ECB and BOE followed suit and increased their policy rates by half a point. ECB President, Christine Lagarde, indicated that borrowing costs need to further increase to temper soaring consumer prices. Long maturity SA government bond yields were up 10 bps versus the previous month. Non-residents were net sellers as the 0.9b outflow in December followed November’s R0.7b inflow. This brings the net cumulative outflow to approximately R29b for the year 2022. The yield curve bear flattened in December on the back of unrelenting global monetary policy tightening. Forward guidance obtained from the U.S. Fed remained hawkish, indicating that the policy rate will culminate at a higher level than market expectations - despite a downshift in pace to 50 bps. To this end, short maturity bond yields increased by an average 29 bps m/m versus the previous month. In the month of December, the ALBI TR ZAR Index was up 0.62% m/m (and up 4.2% y/y), while the CILI TR ZAR Index rose by 2.63% m/m (and up 4.2% y/y). Please Note : The above commentary is based on reasonable assump..ons and is not guaranteed to occur.