Moody's expect the cost of serving the country's debt to continue rising and growth to be slow.
International ratings agency Moody’s on Friday as expected placed South Africa’s rating on review for a downgrade.
Moody’s maintained the country’s foreign and local currency debt on their lowest investment grade rung of Baa3.
“The decision to place the rating on review for downgrade was prompted by a series of recent developments which suggest that SA’s economic and fiscal challenges are more pronounced than Moody’s had previously assumed,” Moody’s said in a statement.
“Growth prospects are weaker and material budgetary revenue shortfalls have emerged alongside increased spending pressures. Altogether, these promise a faster and larger rise in government debt-to-GDP than previously expected.”
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