Standard & Poors Downgrade Coming
International Rating Agency S&P Global has changed what is called its ‘outlook‘ (what they think is going to happen) on SA’s sovereign credit rating from ‘stable‘ (which mean they think things will stay the same) to negative (things are going to get worse) this month.
Why So Negative?
S&P, who are one of 3 key international rating agencies, say that poor economic growth and the government’s worsening debt situation combined with things like the low GDP growth figures, increasing cost of maintaining debt repayments and growing debt levels are making it look like SA is headed for even worse economic pressures in the very near future. Because of all these factors, they are now warning investors off putting money into SA bonds. SA’s ratings now appear to be set to continue its downward journey further and further into “junk” status.