Sat Oct 22 05:41:20 SAST 2016

A 'challenging' year for SA

By unknown | Dec 05, 2008 | COMMENTS [ 0 ]

Tamlyn Stewart

Tamlyn Stewart

Ratings agency Standard and Poor's says it is keeping a close watch on any changes in government policy in response to slowing economic growth.

In Johannesburg yesterday, Konrad Reuss, MD of Standard & Poor's said South Africa had a "challenging" year ahead.

The ratings agency cut South Africa's sovereign rating outlook to negative from stable last month, based on the country's large current account deficit and slowing global growth.

"I think we will have to brace ourselves for weaker growth in the South African economy. Fundamentally, 2009 will be a difficult year," said Reuss.

Growth slowed to its lowest level in 10 years in the third quarter of this year.

He said that even if a relaxation of monetary policy resulted in interest rate cuts in the next few months, it would be "naïve" to believe that, in the midst of a global slowdown, interest rate cuts would very quickly lead to a resumption of growth in the economy.


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