Investing.com -- South Africa’s fiscal performance in the 2025/26 year is likely to trigger positive rating actions from major credit agencies, Goldman Sachs said Thursday.
March budget data completed the fiscal year picture, with revenue outperforming the February budget estimate by around 0.2 percentage points of GDP while expenditure remained in line, Goldman Sachs economist Andrew Matheny wrote in a note.
The risks to the Treasury’s fiscal deficit estimate of 3.7% of GDP are tilted toward outperformance, Matheny said.
Goldman Sachs expects continued fiscal improvements will translate into sovereign credit rating upgrades from the current BB median to BB+ over the next year.
Moody’s is expected to raise its outlook on the Ba2 rating to positive from stable at its scheduled May 22 review, according to the note.
S&P may upgrade its BB rating at its scheduled review on May 29, given the positive outlook in place since November alongside significant fiscal outperformance, Matheny wrote.
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