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Rand survives downgrade storm despite warnings of more to come

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Cape Town – The rand survived the latest rating agency announcement, which saw Moody’s downgrade both the local and foreign currency rating to Baa3 and maintaining a negative outlook.

Ratings agencies Fitch and Standard & Poor’s recently affirmed the country’s credit rating at BB+. Fitch changed its outlook to stable, and S&P affirmed the negative outlook.

“Both Moody’s and S&P are threatening to take the local credit rating below investment grade and it would need each of them to act once to see South Africa excluded from major global bond indices and generate large capital flight,” warned Rand Merchant Bank analyst John Cairns on Monday.

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