[LISTEN] Difficult days ahead with SA's currency downgrade - economist
EWN's Stephen Grootes interviews economist Xhanti Payi following SA's ratings downgrade by Standard & Poor's Global.
JOHANNESBURG - Economist Xhanti Payi says that the latest S&P Global ratings downgrade comes at a heavy price.
The ratings agency cut South Africa's local-currency debt score to junk on Friday, citing a further deterioration in the country’s economic outlook and public finances, sending the rand tumbling.
"People will start taking their money away and that actually puts pressure on the rand with some weakening and that has implications for inflation in the first place. We will hear banks are also being downgraded, and then it costs more to borrow. So that comes at a heavy price."
Listen to the audio above for more.