Domestic debt interest rates - “How low can they go?”
Our topical note on domestic debt interest rates is titled “How low can they go?” is in reference to the sharp fall in domestic debt interest rates over the last few months.
Investors in domestic debt have been concerned over the effect of the falling interest rates on real returns.
We predict that the fall in interest rates will continue for the remainder of 2020 with the yield curve expected to shift downwards.
We further analyze the impact of the decline on short term debt interest rates on commercial bank lending and deposit rates.
Also covered in the report is an analysis of private sector credit where we see private sector lending being subdued in 2020 and possibly through to 2021.
We also analyze the impact of falling interest rates on Government borrowing strategy.
The report concludes with an analysis of real returns showing that investment in short-term investment Government debt outperforms other asset classes. Download Report