The 2023 MTBPS may change credit outlook but not cause a rating downgrade

Credit rating agencies had expected SA’s budget deficit and debt servicing costs to increase, but the pace of deterioration will be a focus. Rating agencies will also focus on the credibility of government’s plan to stabilise finances, given revenue under-collection and the spending overshoot. STANLIB does not expect these agencies will downgrade the country’s already sub-investment grade rating, but the outlook may change from stable to negative. Click here to listen to STANLIB’s Head of Credit: Fixed Income, Tarryn Sankar, discuss the implications of the MTBPS for credit markets.