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Low growth poses risk to SA’s credit rating 

November 10, 2016

SA News, Business Tech

South Africa’s low economic growth has put the country’s sovereign credit rating at risk, says the South African Reserve Bank (SARB).

“Domestically, the low economic growth rate is presenting headwinds to the domestic banking sector and has put the country’s sovereign credit rating at risk,” said the central bank as it released its Financial Stability Review on Wednesday.

Heightened domestic political risk, low business confidence levels, a continued increase in government debt, a persistent current account deficit and slow implementation of the National Development Plan are highlighted as key threats to the country’s credit rating.

The Financial Stability Review aims to identify and analyse potential risks to the financial system’s solidity. The review was released ahead of rating agency Moody’s arrival in South Africa next week.

In Wednesday’s stability review, which is the last stability review for 2016, the SARB said since the last review in May, risks to the South African financial system have increased. Read more

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