The rating agency says the decision was taken on the back of political and institutional uncertainty.

JOHANNESBURG – Standard & Poor’s (S&P) Global has just announced South Africa's sovereign credit rating has been downgraded to BB+.

The rating agency says the decision has been taken on the back of political and institutional uncertainty.

Fears of a downgrade were raised last week already when President Jacob Zuma announced his Cabinet reshuffle in which Pravin Gordhan was axed as Finance minister.

Gordhan's deputy Mcebisi Jonas was also sacked.

Former ANC Youth League president Malusi Gigaba replaced Gordhan at the National Treasury.

In December last, S&P kept South Africa's credit rating unchanged at BBB-, just one level above junk status.

At 5:20pm the rand was trading at R13.52, before dropping sharply to trade at R13.56 just 10 minutes later.

Also in December last year, Moody's kept the country's rating two notches above junk on its scale.

(Edited by Masechaba Sefularo)