Have savings, don’t worry about the ratings downgrades, say analysts
‘Investors always look ahead. Investors anticipated a long time ago that the country’s credit rating might be downgraded, says analyst
South Africans with savings should not worry about the expected downgrade of the country’s sovereign debt rating, because capital markets have a tendency to anticipate events of such an important nature.Furthermore, the risk management of money has already been made on taking positions that hedge for the higher interest rates and equity price movements expected with a further downgrade.This is the view of Francois Strydom‚ Momentum Securities portfolio Mmnager‚ ahead of the announcement by two rating agencies on SA’s debt. Moody’s and S&P are expected to make their decisions on Friday.Another agency‚ Fitch‚ downgraded ratings of debt priced in foreign and local currency to junk status in April. S&P cut the foreign debt rating to junk‚ while Moody’s is a notch above junk status on both foreign and local currency debt.Warren Ingram‚ executive director of Galileo Capital‚ said there would be no consequences for savers in the short term. However, in the long term‚ the expected downgrade...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.