Governor Lesetja Kganyago says that the South African Reserve Bank will have to revise its forecasts following an analysis of the consequences of the ratings downgrade. Speaking at the monetary policy forum on Monday, Kganyago said that at the last monetary policy committee (MPC) in March, it had been noted that "political uncertainty was complicating our lives". "The fear that we would be downgraded did eventually materialise. The chances of a downgrade then was less than 50%, which suggested we would come out of this." The first effect would be that SA will fall out of several global indices, which are used by passive investors to determine where they may invest. The Bank’s head of policy development and research Chris Loewald said: "Our economic perspective is that it’s still too early to say. As we go into the next MPC, we would assess what other developments have taken place and we will have a new forecast." Kganyago said that despite the downgrade, the strength of SA’s institu...
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