What a downgrade by Moody’s would do to SA
We asked ETM Analytics MD George Glynos whether it’s possible to model the effect of a downgrade
11 July 2019 - 05:00
A Moody’s downgrade is getting more probable by the day. But there’s no agreement about what would happen to the rand or our bonds if SA loses its investment-grade status and gets cut from the Citi world government bond index. We asked ETM Analytics MD George Glynos whether it’s possible to model the effect of a downgrade.
Anything’s possible, but the problem with models that are informed by assumptions upon assumptions is that you can get the thing to look whatever way you want it to. That’s exactly why I choose not to go down that road...
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