S&P keeps SA rating un­changed

CityPress - - Business & Tenders -

S&P Global on Fri­day kept its lo­cal cur­rency rating for South Africa at in­vest­ment grade and its long-term for­eign cur­rency rating at the first level of “junk” sta­tus. The out­look on both rat­ings was main­tained at “neg­a­tive”.

“The pace of eco­nomic growth re­mains weak, pos­ing risks to the pace of fis­cal con­sol­i­da­tion,” S&P said.

“The neg­a­tive out­look on the for­eign and lo­cal cur­rency rat­ings re­flects our view that po­lit­i­cal risks will re­main el­e­vated this year, which could un­der­mine eco­nomic growth and fis­cal out­come,” the agency added.

S&P an­a­lyst Gard­ner Rusike said that, since the sur­prise Cab­i­net reshuf­fle and fir­ing of for­mer fi­nance min­is­ter Pravin Gord­han, who was re­placed by Malusi Gi­gaba, the agency had felt a bit bet­ter about the di­rec­tion of South Africa’s fis­cal pol­icy, but it wouldn’t change its rat­ings for now.

The agency had cut its fore­cast of lo­cal growth from 1.4% to 1%, he added.

– Justin Brown

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