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A major factor in emerging economies like South Africa which directly affects their ratings by the international ratings agencies (Fitch, Standard and Poor’s and Moody’s). In general, South Africa has been considered to be fairly stable politically, especially since Ramaphosa became President, but our high government debt levels, especially following COVID-19 are a major concern. One factor in our favour is our low and well-controlled inflation rate - which compares very well with other emerging economies. The downgrading of South Africa's debt to junk status by all three ratings agencies means that it become more difficult and expensive to raise further debt on world markets. The level of political stability also impacts directly on the rand. Anything which is seen as a move back towards the corruption and chaos of the Zuma/Gupta era is negative.

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