Moody’s Favourably Reverses South Africa’s Credit Rating


  • Moody’s kept South Africa’s (SA) foreign and local currency rating unchanged at Baa3, in line with expectations, which left the country eligible for inclusion in the Citigroup World Government Bond Index (Citi WGBI).
  • The favourable credit rating outlook reversal from negative to stable was unlikely fully priced in by markets.
  • A likely return to a more transparent and predictable policy-making environment was cited as the main reason behind Moody’s rating decision.
  • The stable outlook reflected a balance of risks (opportunities and challenges) faced by the new administration.
  • A resolution to the mining charter debate and a balanced approach to land restitution will test the new administration’s ability to address conflicting political priorities.
  • Addressing institutional problems and successfully implementing structural reforms could lead to a ratings upgrade.
  • A faltering commitment to revived growth and debt stabilisation could lead to SA’s credit rating outlook being dropped to negative again.
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