For the most part, it is agreed that there is no need to be concerned about non-resident purchases of South African bonds holding up as long as foreigners are cash-flush. Interest rates in developed markets remain low relative to those in emerging markets, and prolonged easy monetary policy in the developed world has ensured that there is an excess supply of money available. So, it comes as no surprise that developed market investors have been purchasing emerging market debt in pursuit of higher returns than they are able to attain domestically – seemingly irrespective of the relative risks embedded in each sovereign.

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