The main economic events in August are a potential update from Moody’s on SA’s sovereign credit ratings, and in the US the annual Jackson Hole economic conference may provide greater clarity on the unwinding of monetary policy.
The probability of another ratings downgrade for SA is high given the collapse in business confidence and the economy’s slide into a recession. This, coupled with the drift towards more populist policy choices, the failure to clean out the state-owned enterprise (SOE) stable or introduce any material pro-growth reforms are all weighing on SA’s ratings.