By Lehlohonolo Lehana.
Global Moody’s Rating Agency has left South Africa’s credit rating unchanged at Ba2 with a stable outlook following its latest periodic review.
Domestically-focused investors kept an eye on the Moody’s credit rating review, most were expecting an upgrade to a positive outlook from stable.
The review came after S&P Global Ratings last month upgraded South Africa’s foreign currency rating from BB- to BB, while also raising its outlook to positive. Fitch, meanwhile, remains more cautious, holding its BB- rating with a stable outlook — one notch below both Moody’s and S&P.
Moody’s pointed to longstanding bottlenecks, such as ageing infrastructure, a weak labour market and persistent inequality, as the major headwinds to stronger economic performance. These factors, the agency warned, continue to “complicate policy efforts and fuel social tension”.
According to Moody’s, state-owned enterprises have continued to pose a risk to the fiscus.
However, Moody’s has recognised some economic resilience coming through in the country in 2025. It has also noted the progress made during this year in terms of structural reforms around energy and logistics.
The ratings agency says it will be looking closely at the country’s economic growth levels and the sustainability before making any moves on the rating in future.