Frans Cronje Private Clients, an advisory firm, expects Finance Minister Enoch Godongwana to deliver a strong statement of confidence when he presents his Medium-Term Budget Policy Statement (MTBPS) later today.

The firm says the mini-budget will reflect stabilising public finances, with the deficit forecast to narrow to around 4.4–4.5% of GDP this year (from the 4.8% forecast by Treasury in May) and to about 3.5% in the medium term.

According to an advisory note shared with clients yesterday, the firm said that Treasury’s position has improved thanks to a combination of lower borrowing costs, firm revenue, and well-contained government spending. Debt-to-GDP remains well inside the worst predictions of five years ago, while bond yields have fallen to their lowest level since 2021, easing debt-service costs. The rand’s recovery against a weaker dollar and political support for a firmer 3% inflation target have helped to soften external pressures on prices and interest rates.

The firm adds that global rates have begun to fall, creating some policy space for the Reserve Bank to cut interest rates while maintaining an attractive interest rate differential with the United States. The firm also said that South African Revenue Service collections are expected to overshoot earlier projections while expenditure undershoots, adding credibility to the fiscal outlook. It further notes that the exit from grey-listing should reinforce investor confidence.

Frans Cronje Private Clients believes these improvements will allow the minister to project confidence in government’s ability to contain the deficit and maintain downward pressure on debt. The message, it says, will be interpreted as both a fiscal and political signal of stability under the Government of National Unity, with potential to lift market sentiment and lay the groundwork for a future ratings upgrade.