THE probability of a credit rating downgrade for SA is about a third, Moody’s said on Tuesday. However, it warned that a cut was likely if economic growth fell below its estimated growth of 0.2% this year. Moody’s expects growth to increase to 1.1% next year and to 2% gradually over the next several years. The agency is expected to provide an update on SA’s rating on November 25, as it now follows a schedule in line with European rules, in terms of which it will now pencil in three dates each year on which it could confirm, downgrade or upgrade SA’s sovereign ratings. Moody’s currently rates Pretoria two notches above sub-investment grade at Baa2 with a negative outlook, and has warned that political infighting, weak economic growth and mounting debt at state-owned companies all pose a downward risk. Moody’s is watching political developments closely and lead analyst Zuzana Brixiova said on Tuesday that although the current political “noise” was not an issue in itself, the question ...

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