South Africa’s banking system is robust enough to withstand a credit ratings downgrade, South African Reserve Bank governor Lesetja Kganyago stressed on Thursday, as the country awaits a pending ratings review from agency Moody’s.
“To the extent that the market has priced in a possible downgrade, then if a downgrade takes place, it shouldn’t have an impact on the financial markets,” he said. It is the last of the three main ratings agencies, which include Standard & Poor’s and Fitch to rate South Africa’s debt at investment grade. Should it downgrade the country, South Africa will fall out of important global government bond indices, which are tracked by major global investment funds. This could trigger estimated capital outflows of between $8-billion and $10-billion.
“Even under that adverse scenario the South African banking systems came out with flying colours,” he said.Despite a damaging bout of load-shedding by embattled parastatal Eskom last week, and a February budget that outlined the severity of the government’s financial constraints, Moody’s may not pull the trigger just yet, argue some economists.
But it has also acknowledged that, outside of this, state spending, including on the wage bill, had slowed.
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Fonte: SABC News Online - 🏆 32. / 51 Leggi di più »
Fonte: SABC News Online - 🏆 32. / 51 Leggi di più »