Rating agency Moody’s skips scheduled review of South Africa

Credit Rating agency Moody’s has skipped a scheduled review of South Africa’s sovereign rating.

The agency was expected to make an announcement on the country’s rating on Friday night but instead the agency published a notice stating that the rating for South Africa and other countries such as Italy were not updated.

Last year, Moody’s downgraded the country’s debt to “junk” status with a negative outlook.  At the time it cited the country’s ballooning debt servicing costs and a high civil servants wage bill as some of reasons behind the downgrade.

Moody’s has not given any indications as to when an announcement can be expected.

Chief Economist at Efficient Group Dawie Roodt says the move is not unusual.

“We have to remember that rating agencies are private organisations they postpone their announcements or they change ratings, and they can do it whenever or whatever they want to do because they are private organisations, and a postponement like this is nothing unusual.”

He adds: “I don’t think we should read anything into this. But as far as South Africa’s rating are concerned, I think our rating current levels will remain unchanged and I think for a couple of months. But I’m afraid if we do not fix especially the state’s finances, further downgrades can be expected but for now I think things are going to remain unchanged at least for a couple of months.”