S&P sees SA moving in the right direction, but no ratings upgrade yet.
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On Friday, S&P lifted the outlook on SA’s sovereign credit rating to positive and highlighted SA’s favourable terms of trade. Terms of trade compare the price of a country’s exports versus its imports.
The decision by the agency, which rates SA’s debt three levels below the highly coveted investment grade, also reflected the government’s improving fiscal metrics as it largely kept its word on keeping borrowing in check and benefited from higher commodity prices. SA’s debt to GDP ratio — a measure of the country’s financial health watched by ratings agencies — is expected to peak at about 75%, along way from previous estimates of 95%.
The decision by the agency, which rates SA’s debt three levels below the highly coveted investment grade, also reflected the government’s improving fiscal metrics as it largely kept its word on keeping borrowing in check and benefited from higher commodity prices. SA’s debt to GDP ratio — a measure of the country’s financial health watched by ratings agencies — is expected to peak at about 75%, along way from previous estimates of 95%.
