Moody’s keeps South Africa rat­ing un­touched

The Myanmar Times - - International / Business -

IN­TER­NA­TIONAL credit rat­ing firm Moody’s has left South Africa’s sov­er­eign debt grad­ing un­changed two notches above junk sta­tus, but warned that the coun­try is not yet out of the woods.

Moody’s still rates Africa’s most de­vel­oped econ­omy as Baa2 – mean­ing it is of in­vest­ment grade for banks – al­beit with a neg­a­tive out­look.

In­stead of the much an­tic­i­pated for­mal re­view of South Africa’s credit rat­ing, Moody’s is­sued an up­dated credit opinion overnight, warn­ing that the neg­a­tive out­look re­mained be­cause of po­lit­i­cal ten­sions and weak growth.

“The neg­a­tive out­look on South Africa’s Baa2 gov­ern­ment bond rat­ing re­flects risks re­lated to the im­ple­men­ta­tion of struc­tural re­forms aimed at restor­ing con­fi­dence and en­cour­ag­ing in­vest­ment,” it said in a state­ment.

Moody’s warned that South Africa’s rat­ing “would likely be down­graded in the ab­sence of fun­da­men­tal struc­tural re­forms sup­port­ing higher and sus­tain­able medium term growth”. –

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