Rand weakens ahead of S&P credit rating review
South Africa risks having its sovereign credit rating downgraded to “junk” status for the first time since 2000.
JOHANNESBURG – The rand has weakened ahead of a review of South Africa’s debt by Standard & Poor’s Global at a time when the economy is struggling and the country is facing an ongoing power struggle within the ruling party.
The currently is hovering around R14,12 to the dollar.
The country risks being downgraded to “junk” status for the first time since 2000, while government needs to borrow about R165 billion this fiscal year to help plug the budget deficit.
Treasury warned last month that its borrowing costs could double or triple if it falls into sub-investment grade, which would also deter investment.
(Edited by Masechaba Sefularo)