South Africa affirmed by S&P, outlook remains negative

Foreign currency rating affirmed at BB+

• South Africa local-currency rating affirmed at BBB-
• Political risks high for the remainder of the year
• Sees growth averaging -0.7% from 2015-2018
• Negative outlook reflects political risks
• Ratings constrained by weak economic growth

There was some speculation the foreign currency debt would be downgraded. There was also some speculation the outlook would be shifted to stable.

Last week, South African political leaders met with S&P and it appears as though whatever they said worked but S&P wants to see some government stability.

Very little reaction from USD/ZAR.