SA can move from junk status to comeback kid by doing the right things
Strong institutions should push the government harder to accelerate reforms to improve the economic growth outlook
It is no surprise that Moody’s Investors Service has finally downgraded SA to subinvestment grade, or “junk” as it is sometimes called. This change aligned Moody’s rating to that of Fitch and S&P Global Ratings, with all three agencies on a negative outlook.
Last week Fitch went a step further and downgraded again, making it the most bearish agency at present, two notches below investment grade. Moody’s remains one notch below investment grade, while S&P’s split rating (local- and foreign-currency ratings) are a respective one and two notches below investment grade. The question that arises: is “junk” just “junk”?..