Barely a week after Fitch Ratings demoted Eskom’s outlook on its credit ratings to negative from stable, Standard & Poor’s (S&P) has downgraded the utility’s long-term local and foreign currency rating to BBB– from BBB. The rating agency has also placed Eskom on “credit watch with potential negative implications”. Eskom’s finance director, Tsholofelo Molefe, said he was concerned about the negative implications of this credit watch for the company. The BBB– rating on its own is considered the lowest investment grade by market participants. Although a credit watch does not mean another downgrade to junk status is inevitable, it does mean that the rating might be lowered. – Londiwe Buthelezi