THE office party season is upon us once again and my usual impeccable sources showed scant interest in the markets this week. Bonds continue to remain firm although there was a small sell-off towards the weekend which took rates a little higher. This was almost certainly the result of profit-taking and the market remains fundamentally strong. Although money market rates look as though they will remain static until the beginning of the new year, the feeling among bond traders is that short-term interest rates are expected to fall further once the Y2K fears are over.
Foreign activity seems to have tailed off and trading seemed to be jobber-driven in a thin market.
The gap between the R150 and the long-dated R153 remains at around 50 basis points. Bond option traders reported that there had been a slight increase in volumes although most institutions were remaining on the sidelines.