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Analysts who thought a downgrade by Moody’s Investors Service at the end of this month could not happen without a change to the outlook are wrong. This is because a rating can be downgraded without previously having been assigned a negative outlook, according to a reference guide from Moody’s sent to Business Day on Tuesday. A ratings outlook is an opinion regarding the “likely rating direction over the medium term”, it said. This means SA could still see a downgrade later this month, when Moody’s is set to make an announcement. Moody’s does not need to first change SA’s outlook to negative to signal a future ratings downgrade to junk. However, after the initial assignment of a stable outlook, about 90% of ratings experience no change in rating during the following year, Moody’s said. “They don’t have to change the outlook before if they don’t want to, but it would be unusual for them to do so,” Nedbank chief economist Dennis Dykes said. “I don’t think they’d make a move that drasti...

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