Moody’s was fairly positive that finance minister Pravin Gordhan’s budget plan would curb excessive spending in the medium-to-long term.<\/p>\n
However, the group changed the country’s outlook to negative – a warning that the stressful times were far from over.<\/p>\n
The negative outlook reflects all the risks still facing South Africa, including the volatility of the international markets, Moody’s said.<\/p>\n
Other ratings agencies<\/h3>\n
The Moody’s outlook for South Africa is contrasting to economists’ views of the country, which may still play out in other ratings agencies, Fitch and Standard and Poor’s.<\/p>\n
Both Fitch and S&P have South Africa at one notch above junk, and have historically had a more negative and critical view on the country. Both agencies still have to do their review of the country, with S&P expected to start in June.<\/p>\n
![\"Credit](\"http:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2015\/12\/Credit-rating-history-1994-2015.png\")
<\/a>Credit rating history 1994-2015<\/p><\/div>\n
Economists expect at least one, or both, of the ratings agencies to take a negative swing on the country and to cut its credit rating to junk.<\/p>\n
The South African Reserve Bank shares this negative outlook, saying that the country faces a medium to high probability of a downgrade this year.<\/p>\n
Reuters pointed to subdued risk appetite amid concern by investors about weak global growth, while SARB warned that that any ratings downgrade could lead to increased capital outflows.<\/p>\n
More on South Africa<\/h3>\n
What the Reserve Bank thinks about SA junk status chances<\/a><\/strong><\/p>\n How long it could take SA to recover from junk status<\/strong><\/a><\/p>\n