Johannesburg Credit Rating Affirmed at Ba3 as Moody’s Assigns Positive Outlook

The Johannesburg credit rating has been affirmed at Ba3 by Moody’s Investors Service, with the outlook revised to positive—a sign of improving financial management and growing confidence in the city’s reform programme.

Rating affirmed as reform momentum builds

On 4 July 2026, Moody’s Investors Service affirmed the City of Johannesburg’s long-term issuer rating at Ba3, concluding the review it launched in April without a downgrade.

The agency also assigned a positive outlook, reflecting its expectation that Johannesburg’s financial position is likely to strengthen over the next 12 to 18 months. A positive outlook indicates that, if reforms continue to gain traction, the city could be considered for a ratings upgrade.

Johannesburg had been placed under review earlier this year amid concerns over its financial reporting and governance. The City has since stated that it has restored compliance with the JSE Debt Listings Requirements and that trading in its listed debt instruments has resumed. However, the exact timing and reasons behind the suspension and reinstatement should be interpreted according to official JSE and Moody’s disclosures.

Mayor Dada Morero and City Manager Floyd Brink welcomed the decision, describing it as recognition of the municipality’s efforts to strengthen governance, improve financial discipline and restore investor confidence.

For investors, the outcome removes immediate downgrade risk while signalling that rating momentum is now moving in a more constructive direction.

Positive outlook, but challenges remain

Although the outlook has improved, Johannesburg remains below investment grade.

A Ba3 rating indicates speculative credit quality and reflects meaningful credit risk, although the city’s financial position is viewed as stabilising.

Moody’s has not suggested that Johannesburg’s challenges have been resolved. Rather, the positive outlook reflects the expectation that continued improvements in governance, budgeting and financial management could strengthen the municipality’s credit profile over time.

City officials say reforms are focused on:

• Strengthening financial oversight.
• Improving budget discipline.
• Enhancing internal controls.
• Supporting more reliable service delivery.
• Restoring long-term fiscal sustainability.

Successful execution of these measures will be critical if Johannesburg is to secure a future ratings upgrade.

Implications for investors

For bondholders and lenders, the affirmation provides reassurance that Johannesburg continues to access capital markets while pursuing fiscal reforms.

A positive outlook can gradually improve market confidence by:

• Supporting tighter borrowing spreads.
• Lowering future financing costs.
• Broadening investor appetite for municipal debt.
• Strengthening confidence in long-term infrastructure financing.

At the same time, governance, liquidity and execution risks remain important considerations for investors evaluating South African municipal credit.

The next 12 to 18 months will be crucial. Markets will closely monitor whether Johannesburg delivers sustained improvements in financial management and governance that justify a move beyond the current Ba3 rating.

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