CAPE TOWN – South Africa now has slightly better chance of avoiding a sovereign debt rating downgrade when Moody’s reviews the economy in November.
This means that the country has avoided a technical recession – typically defined by two consecutive quarters of negative growth, said Carl Coetzee, the chief executive of bond originator BetterBond.
Moody’s is the only one of the top three agencies to still award SA an investment-grade rating, and losing that would be an automatic signal for institutional investors to withdraw billions of rand from South African markets.
Statistician-General Risenga Maluleke revealed on Tuesday that South Africa’s gross domestic product (GDP) increased by 3.1 percent in the second quarter of 2019, from a revised 3.1 percent in the first quarter.
Risenga said several industries that had contributed positively to the growth, such as finance, real estate and business services increased by 4.1 percent and increased economic activity was reported for financial intermediation, real estate activities and business services.