The rand was 0.4% weaker at R13.81/$ at 7am — bearing up relatively well after Fitch downgraded SA’s sovereign credit rating to subinvestment grade on Friday. Fitch’s rating was harsher than S&P Global Ratings’ downgrade last Monday in that it cut both rand and foreign currency debt to BB+ whereas S&P kept SA’s rand-denominated debt at BBB-, one level above junk. But some good news in Fitch’s statement was it gave SA a stable outlook whereas S&P kept its outlook negative — a hint S&P may also cut SA’s rand-denominated debt to junk soon. "It would appear that the financial markets (especially the currency and bond markets) had largely priced in the Fitch rating’s decision, as well as the looming decision by Moody’s," Stanlib chief economist Kevin Lings said in a note on Friday. "Importantly, it still holds that most international investors are still not forced sellers of South African government bonds, especially were SA is included in global bond indices." Echoing S&P, which cut Esk...
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