South Africa’s 10-year government bond yield fell to 7.89%, its lowest level since March 2015, after authorities signaled that public debt is expected to peak in the current fiscal year. Finance Minister Enoch Godongwana said debt will stabilize for the first time in 17 years as the budget deficit narrows and debt-service costs decline, underscoring a recent credit-rating upgrade and a rally in the bond market.
The 2026 Budget Review projects the debt-to-GDP ratio to peak at 78.9% in 2025–2026, slightly higher than earlier estimates due to weaker nominal growth and increased borrowing. Nevertheless, debt-service costs are forecast to rise more slowly than total expenditure, reducing payments as a share of revenue to 20.2% by 2028–2029 from 21.3% in the current year. Expectations that Fitch Ratings and Moody’s Ratings may shift their outlooks to positive have further bolstered demand for South African government bonds.
