'Moody's is being quite lenient, we have got to implement policy changes'
Despite a downgraded growth expectation for 2019, Moody's says there is a "low likelihood" of a downgrade in South Africa's credit rating.
On Tuesday Moody's revealed that it had revised down the country's growth forecast for 2019 from 1% in June to 0.7%, citing slow pace in policy implementation.
Stanlib Asset Management chief economist Kevin Lings says the firm has generally been 'fairly positive' about South Africa's economy despite its deterioration.
Explaining what is used to determine a low investment grade, Lings says the firm's view may be that the deterioration is not as stark as what is seen in other countries.
They constantly remind us that they are assessing South Africa relative to other emerging markets. On a relative basis South Africa doesn't represent the type of risk that they have seen in many other countries.Kevin Lings, Chief economist - Stanlib Asset Management
He says Moody's is being quite lenient and that government have got to implement policy changes.
The second thing, they pointed that out in their conference meeting, is that they do see that government is talking about the right types of reforms, they are saying that government needs to go from talking about the right type of reforms into implementing it.Kevin Lings, Chief economist - Stanlib Asset Management
I guess they do buy into the notion that government is trying to stabilise government finances etc and put South Africa on a better path. The question is will they still give us this time?Kevin Lings, Chief economist - Stanlib Asset Management
I think there have been warnings, I think they have been quite lenient. They clearly are willing to tolerate further leniency but that is not endless.Kevin Lings, Chief economist - Stanlib Asset Management
Click on the link below to hear the full conversation...
Enjoy The Money Show, but miss it sometimes?
Get the best bits emailed to you daily, right after it ends:
This article first appeared on 702 : 'Moody's is being quite lenient, we have got to implement policy changes'
Macfarlane Moleli tells The Money Show how he structures his life and sets goals.Read More
The pick of the day's crop as chosen by Caroline Cremen, Portfolio Manager, Adviceworx.Read More
“ Government must ensure that state-owned entities have boards with the right mix of skills to fulfil their mandates."Read More
Damaged undersea cables frustrated many SA internet users this week. We get an update on the situation - and a backup plan.Read More
The UK-Africa summit is underway and after Brexit, the UK reportedly wants to boost trade with our continent.Read More
Think twice before fabricating or over-stating your qualifications.Read More
It's the largest, most-prestigious MBA competition in the world - 36 business schools from around the world took part.Read More
Education inflation is at about 10%, says Old Mutual. The implications are terrifying. Gerald Mwandiambira (CFP) has advice.Read More
She allegedly did it without President Cyril Ramaphosa’s permission, as required by the Ministerial Handbook.Read More
"It’s millions! It’s millions! The next stage… is famine," warns Gerald Bourke, a spokesperson for the UN World Food Programme.Read More