Key facts
- Fitch Ratings upgraded South Africa's credit rating for the first time since 2005.
- South Africa's main budget deficit was ZAR 63.3 billion in April, unchanged at 0.8% of GDP.
- South Africa's revenue increased 12.5% year-on-year to ZAR 117.5 billion in April.
- Fuel levy relief reduced South Africa's revenue collections by ZAR 4.1 billion in April.
- India's fiscal deficit is projected at 4.4% of GDP for the fiscal year ending March 31, 2026.
- India's fiscal deficit reached 15.19 trillion rupees for the fiscal year ending March 31, 2026.
- South Korea's current account surplus was $28.29 billion in April.
- Mexico's public sector primary surplus grew to MXN 77.1 billion in April.
- Brazil's government increased its budget freeze by BRL 23.7 billion.
- New Zealand's fiscal surplus remains dependent on economic growth.
South Africa has received its first credit rating upgrade from Fitch Ratings since 2005, a move attributed to prudent fiscal management and progress in navigating economic challenges. The nation's main budget deficit held steady at 0.8% of GDP in April, with revenue rising 12.5% year-on-year to ZAR 117.5 billion. This revenue growth was primarily fueled by stronger personal income tax (PIT) and value-added tax (VAT) collections, though a ZAR 4.1 billion reduction in collections resulted from fuel levy relief.
Despite global economic uncertainties, Bank of America foresees a robust period for deal-making in South Africa, according to the head of its local operations. In other economic news, India's fiscal deficit for the fiscal year ending March 31, 2026, is projected to be 4.4% of GDP, aligning with government estimates. The deficit reached 15.19 trillion rupees, accounting for 97.5% of the February projections.
South Korea experienced a narrowing of its current account surplus in April, which fell to $28.29 billion from $37.93 billion in March. This decrease was largely due to a shift in the primary income account to a deficit, even as the goods surplus saw a significant increase driven by robust export growth. Mexico's public sector reported a primary surplus of MXN 77.1 billion in April, an increase attributed to a reduction in public spending, while the general deficit also decreased to MXN 37.1 billion.
Brazil's government has raised its budget freeze by BRL 23.7 billion to manage rising mandatory expenditures, particularly in welfare and social security. Nevertheless, the government anticipates a primary surplus of BRL 4.1 billion in 2026, supported by increased revenue from higher energy prices. For New Zealand, the return to a fiscal surplus is still dependent on sustained economic growth, linking the nation's financial health closely to its economic performance.