South Africa’s Medium Term Budget (MTB), announced last month, received a mixed reception. Government bond yields fell slightly on the day it was announced. But last week, Moody’s downgraded South Africa’s credit rating from Baa1 to Baa2, citing concerns about growth prospects and rising government debt. We are also pessimistic about the outlook for growth and debt. But as we show in this Watch, the government actually has a good track record of hitting its fiscal forecasts.
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