Moody’s cuts South Africa’s 2020 GDP growth forecast to 0.7%

Ratings agency Moody’s has cut its 2020 growth forecast for South Africa to 0.7% from a September forecast of 1.5%, saying the economy remains stuck in low gear due to lacklustre domestic private-sector demand.

Moody’s also attributed the revised forecast to “the detrimental impact of widespread power outages on the manufacturing and mining activity,” it said in a research report.

The rating agency left South Africa on the brink of “junk” status in November last year after it revised the outlook on the country’s last investment-grade credit rating to “negative,” piling pressure on President Cyril Ramaphosa to quicken the pace of reform.

Moody’s is the last of the major international agencies to keep an investment-grade rating on the sovereign and is scheduled to review that assessment in March.