Analysts say the recent unexpected upgrade of the outlook for South Africa to “stable” by the credit rating agency Fitch is a welcome boost for investor confidence in South Africa.
Fitch kept the nation’s foreign and local currency ratings at BB-, still three levels below investment grade, and it’s still well into so-called “junk status”.
University of Venda Economics lecturer Dr Azwi Nemushungwa says Fitch’s improved outlook for South Africa may whet the appetites of global investors.
“So, the BB rating simply means that the country is now put on 3 steps lower than what you call the investment level, where the investors all over the world can trust South Africa – as an economy that they can feel safe to invest. At least, it’s only 3 steps lower, unlike when we are maybe put on level C or level D, which is the lowest level. So, that sends a slight positive message to investors.”
Fitch Ratings Agency revises South Africa’s credit rating to a BB-, a stable outlook:
