A well-developed rand OIS market would have many risk management benefits. Market participants predominantly use the OIS market for hedging activities, to hedge either their funding costs or their exposure to short-term interest rate movements, and to alter the term structure of a portfolio.
The fixed-rate portion is also used by some market participants to derive market expectations of the Bank’s future policy rate changes. This work will culminate in an industry-wide consultation to deliberate on the format of a rand OIS  1  An interest rate swap involving the floating rate being exchanged for a fixed interest rate.