South African assets are attracting renewed investor interest as concerns about stagflation and rising inflation ease, according to a Bank of America survey of institutional fund managers. A net 93% of respondents reported more buying than selling opportunities, the highest level recorded since 2009. The improvement follows a sharp decline in oil prices, which reduced inflation pressures and improved economic sentiment. Mining stocks have become particularly popular, reaching their highest allocation levels in five years. Despite the improved sentiment, investors still expect the South African Reserve Bank to raise interest rates during the third quarter to guard against future inflation risks. South African government bonds are also viewed as attractive, while analysts expect the rand to strengthen.
CNBC Africa
