Credit ratings firm Moody’s further trimmed its economic growth forecast for South Africa to 0.7% in 2019 from a June forecast of 1.0%, saying a slowdown in global and regional growth would impact negatively on government tax revenue and hurt growth.
Moody’s, which assigns South African debt its only remaining investment-grade rating, sees gross domestic product growth in 2020 of 1.5%, its associate managing director for financial institutions Antonello Aquino said on Tuesday at a credit conference in Johannesburg.
SA’s investment-grade rating depends on pace of reforms – Moody’s
Ratings firm Moody’s said on Tuesday fiscal risks and political constraints to economic reform in South Africa were reflected in its current credit rating of one notch above speculative grade but that maintaining the level depended on how quickly the Ramaphosa-led government can implement promised reforms.
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“A lot of the deterioration we have witnessed is embedded in the ratings level and the past downgrades. The question of course, is going forward. Our expectation is stabilisation in debt,” said Moody’s lead analyst for South Africa Lucie Villa at a credit conference in Johannesburg.