South Africa’s 10-year government bond yield hovered around 8.86%, the lowest level since December 2024, reflecting investor optimism about the country’s economic and fiscal fundamentals. South African assets has seen strong performance this year supported by progress on fiscal consolidation, the stability of the coalition government (GNU), alongside structural improvements such as more reliable electricity and increased infrastructure investment. A credible monetary policy, a more stable currency and expectations of a lower inflation target also played a key role. The recent removal from the FATF “grey list,” have further boosted confidence and could attract foreign investment. At the same time, recent interest rate cuts by the US Federal Reserve, along with gold’s continued strength, have boosted the appeal of the country’s bonds. However, challenges persist, most notably stubbornly high unemployment, which continues to weigh heavily on young people.