Market Lauds South Africa’s Election as Risks Decrease: Chart

The premium investors demand to hold South Africa’s dollar bonds rather than U.S. Treasuries fell to a one-year low in the week after local-government elections on Aug. 3. Another measure of risk, the cost of insuring the debt for five years using credit-default swaps, also fell to a one-year low. The election result, which saw a move of support away from the ruling African National Congress, could be credit-positive as it shows the electorate holding the government accountable for its economic policies, Moody’s Investors Service said on Aug. 8.

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