S&P cuts South Africa rating

S&P said it lowered the long-term foreign currency sovereign credit rating on the Republic of South Africa to BB+ from BBB- and the long-term local currency rating to BBB- from BBB.

S&P also lowered the short-term foreign currency rating to B from A-3 and the short-term local currency rating to A-3 from A-2. The outlook on all the long-term ratings is negative.

In addition, S&P lowered the long-term South Africa national scale rating to zaAA- from zaAAA and affirmed the short-term national scale rating at zaA-1.

S&P said the downgrade reflects its view that the divisions in the ANC-led government that have led to changes in the executive leadership, including the finance minister, have put policy continuity at risk. This has increased the likelihood that economic growth and fiscal outcomes could suffer.

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