Fitch affirms junk rating for South African economy

Ratings agency Fitch affirmed South Africa’s sub-investment grade rating with a stable outlook.

Fitch in a statement in Johannesburg warned that weak economic growth remained a key risk.

South Africa’s ratings are weighed down by low trend GDP growth, sizeable contingent liabilities and deteriorating governance. Positively, they are supported by deep local capital markets, a favourable government debt structure and a track record of fairly prudent fiscal and monetary policy.”

Fitch downgraded South Africa to BB+ from BB- on both foreign and local currency debt in early April after a cabinet reshuffle that saw respected finance minister Pravin Gordhan dismissed.