South African Finance Minister Enoch Godongwana is expected to signal the country\u2019s commitment to fiscal discipline on Wednesday (21 October), with its debt-to-GDP ratio set to decline for the first time in more than two decades.<\/p>\n\n\n\n
This potentially paves the way for a credit-rating upgrade as soon as next month.<\/p>\n\n\n\n
Four of 11 economists surveyed by Bloomberg, including those at Bank of America, Morgan Stanley, BNP Paribas SA and Old Mutual, anticipate an upgrade by year-end, while the rest see it coming in 2027.<\/p>\n\n\n\n
Moody\u2019s Ratings\u2019 and S&P Global Ratings\u2019 next reviews are scheduled for 27 November, and Fitch Ratings\u2019 for 11 December.<\/p>\n\n\n\n
\u201cWe view Moody\u2019s as the most likely agency to act, with a potential upgrade to Ba1, while an S&P upgrade to BB+ remains a closer call,\u201d Tatonga Rusike, BofA\u2019s sub-Saharan Africa economist, said. <\/p>\n\n\n\n
Fitch is in no rush after its upgrade in June<\/a>, he said.\u00a0<\/p>\n\n\n\n Moody\u2019s said last week<\/a> that Africa\u2019s largest economy is heading for its first upgrade by the company since 2009, provided its fiscal performance continues to improve.\u00a0<\/p>\n\n\n\n Morgan Stanley expects<\/a> S&P to raise South Africa\u2019s rating to BB+ next month and Moody\u2019s in early 2027.<\/p>\n\n\n\n Both rating companies have South Africa on a positive outlook, and an upgrade by either would lift the country to one notch below investment grade, putting it on the path to exit junk status.\u00a0<\/p>\n\n\n\n Investec Wealth & Investment International sees<\/a> a greater-than-50% chance that the country will regain its investment-grade credit rating within two years, and BofA expects it to do so before 2029. <\/p>\n\n\n\n Rating companies will need evidence of \u201ca durable improvement in fiscal metrics, including lower deficits, falling government debt and firmer trend growth,\u201d Rusike said.<\/p>\n\n\n\n When Godongwana delivers his medium-term budget policy statement at 14h00 in Cape Town on Wednesday, he\u2019s expected to show the National Treasury beating its consolidated budget-deficit forecast<\/a> of 4% of GDP for 2026-27, with economists surveyed by Bloomberg estimating a shortfall of 3.8%.<\/p>\n\n\n\n They also project the Treasury to have met its goal of stabilising debt in the year through March 2026. <\/p>\n\n\n\n