Rand crashes through R19/$ and is down more than 18% in the past month
SA was dealt another blow late on Friday when Fitch Ratings downgraded the country further into junk, just a week after Moody’s Investors Service stripped it of its last remaining investment grade. The rand extended its losses, crashing through R19/$.clear path towards” stabilising its debt position, a situation that would be worsened by the effect of the Covid-19 shock on economic growth and public finances.
The Fitch move came at the end of a difficult week for markets, with general volatility worsened by concern that SA’s credit-rating downgrade by Moody’s would lead to an exodus of funds, increasing government’s borrowing costs at a time when a shrinking economy will decimate its tax collection. FTSE World Government Bond Index, it reinforces negative sentiment towards an economy that slipped into recession even before the coronavirus outbreak.
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