South Africa's Yield Curve Makes Long End a Buy for JPMorgan

(Bloomberg) -- In a rising-yield environment, it’s usually best to lessen risk by reducing duration.

But in South Africa, where there’s around 200 basis points of spread between two-year and 30-year yields, long bonds remain attractive, according to Didier Lambert, a portfolio manager at JPMorgan Asset Management in London.

The premium of 30-year yields over two-year yields in Africa’s most-industrialized economy is among the highest in emerging markets. Improving external finances and rising real yields have also increased the attractiveness of South Africa’s debt, Lambert said an an interview last week.

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