S&P call 'will keep SA debt sexy'
Government debt will remain attractive to investors and should not be affected by S&P Global Ratings' decision, says National Treasury director-general Lungisa Fuzile
Government debt will remain attractive to investors and should not be affected by S&P Global Ratings' decision on Friday to lower the long-term local currency rating on South Africa to BBB from BBB+, National Treasury director-general Lungisa Fuzile said shortly after the announcement was made. The rand firmed more than 2% to R13.78 against the dollar after the announcement. The country dodged a ratings downgrade for the third time this year on Friday when S&P, the most critical of the three major international credit ratings agencies, affirmed South Africa's foreign currency BBB- rating - one notch above junk status - and kept the outlook at negative. But it warned that it could lower the rating, if, for example, South Africa entered a recession next year or wealth levels continued to decline in US dollar terms. "We could also lower the ratings if we believed that institutions had become weaker due to political interference affecting the government's policy framework," it said. Oth...
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