Ratings agency Fitch affirmed South Africa's sub-investment rating on Thursday, warning that the reasons it originally downgraded the country to junk status remain a "key risk".
Fitch downgraded South Africa to BB+ from BB- in April after a cabinet reshuffle that saw finance minister Pravin Gordhan sacked.
"South Africa's ratings are weighed down by low trend GDP growth, sizeable contingent liabilities and deteriorating governance," Fitch said in a statement.
"Positively, they are supported by deep local capital markets, a favourable government debt structure and a track record of fairly prudent fiscal and monetary policy."
In-fighting within the ANC ahead of the electoral conference in December was also cited as a reason for keeping South Africa on junk status, reported Eyewitness News.
Fitch added it is unlikely that government will raise its expenditure ceilings, which have served as anchor for fiscal policy.
GDP growth showed a five-year average of just 1.6% and South Africa's current account deficit narrowed to 3.2% of GDP in 2016 from a peak of 5.9% in 2013, Fitch said.
The rand dipped below R13 to the dollar before 1pm on Thursday, reported Fin24:
"This outcome demonstrates that South Africans must continue to act in unison especially during difficult times and work even harder to make sure that the country reclaims its investment grade status," National Treasury said in a statement on Thursday.
"As Fitch has rightly mentioned, rhetoric of 'radical socioeconomic transformation' does not imply a fundamental policy shift," Treasury added. "The main focus of government is to address the long-standing goal of inclusive growth. Fast-tracking the implementation of the structural reforms on growth and addressing the financial and governance issues of some of the SOCs are priorities in the short term."