EDITORIAL: SA gets a loud and clear warning from ratings agencies
Traditionally the most optimistic about SA, the negative note from Moody’s is a cause of concern
Look on the bright side. After the political ructions of recent months, SA can be grateful that it has survived another round of ratings updates with its investment grade local currency ratings from Moody’s and S&P intact. Next time, SA may not be so lucky. And that is the message that comes out loud and clear, not only from Moody’s, which late on Friday night downgraded SA’s foreign and local currency ratings to just one notch above subinvestment grade, or junk status, but also from the other agencies. Moody’s has traditionally been the most optimistic about SA, and often the most insightful about its political landscape. It was the one agency that took SA right up to the coveted A rating band before the downgrades began in 2012. It has also been the agency that has been most cautious in the negative actions it has taken, and as pressure on the public purse has intensified. While others were increasingly concerned about the political "noise" and what it might mean for policy, Moody...
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