South Africa may be on the verge of a sovereign credit-rating upgrade, driven by stronger-than-expected fiscal performance, according to Bloomberg.

Finance Minister Enoch Godongwana is set to present the Medium-Term Budget Policy Statement at 2 p.m. on Wednesday in Cape Town, where the National Treasury is expected to report a deficit at or below its projected 4.6 percent for the 2025–26 fiscal year. “They’re outperforming by a large margin and likely to present a constructive fiscal picture,” said Andrew Matheny, an economist at Goldman Sachs.

S&P Global Ratings, which currently assesses South Africa’s long-term foreign debt at BB-, three notches below investment grade with a positive outlook, is scheduled to review the country’s rating on Friday. A ratings upgrade would signal growing confidence in the government’s fiscal consolidation, which has struggled with repeated bailouts of state-owned enterprises and high deficits in recent years.

Analysts say the review will focus on three key factors: modest economic growth, continued fiscal discipline, and no new state-owned enterprise rescues. Four of nine economists in a Bloomberg survey, including those at Bank of America Corp. and RMB Morgan Stanley, anticipate an upgrade this year.

Others remain cautious. Citigroup Inc.’s South Africa economist, Gina Schoeman, suggested that November’s review may be premature. She noted that stronger GDP growth, higher fixed investment, a stabilised debt ratio, and a more stable government formed after the 2024 elections could support a rating change in 2026 instead.