Relief as Moody’s gives SA another chance
SA gets another stay of execution, hovering one notch above junk, but with the outlook upgraded to stable — signalling cautious optimism about turnaround plans
A change in the country’s leadership and a national budget that was well received by markets has helped SA escape a credit rating downgrade from Moody’s. It’s the first verdict on the country’s creditworthiness since President Cyril Ramaphosa assumed office. Moody’s maintained its sovereign rating for SA at Baa3, one rung above junk status, with a stable outlook. The rand was unchanged a few minutes after the announcement, last trading at R11.74 to the dollar. It had strengthened earlier in the day from R11.84/$. “The confirmation of SA's ratings reflects Moody's view that the previous weakening of SA's institutions will gradually reverse under a more transparent and predictable policy framework. The recovery of the country's institutions will, if sustained, gradually support a corresponding recovery in its economy, along with a stabilisation of fiscal strength,” Moody’s said. Moody’s is the only one of three major ratings agencies that has SA’s foreign currency and rand-denominated...
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