Goldman Sachs Sees ‘Sharpening of Knives’ in S. Africa’s ANC
- Removing Gordhan will result in credit downgrade, Coleman says
- South Africa needs ‘growth and jobs more than anything’
Rand Reaction to Gordhan Benign, Says Coleman
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Divisions within the governing African National Congress are deepening and a potential downgrade of South Africa’s debt rating to junk isn’t fully priced in by markets, according to Goldman Sachs Group Inc.
The rand slumped as much as 4.3 percent against the dollar on Tuesday, the most since June, and bond yields rose to the highest in more than a month after prosecutors said Finance Minister Pravin Gordhan must appear in court on Nov. 2 on fraud charges. Five-year South African credit-default swaps, an indication of risk, climbed 15 basis points on Tuesday to 265, the highest level since July 8 and above those of Russia, Brazil and Turkey, which all have junk credit-ratings.