The Reserve Bank governor says it will continue to play a supportive role, but SA’s economic growth cannot be left to the Bank alone
Reserve Bank governor Lesetja Kganyago has dismissed calls for it to shake-up monetary policy to deal with the economic fallout from the Covid-19 pandemic.
“There are tough choices for us to make as a society. However, as we have indicated in the past, improving the potential growth rate of the economy cannot be left to the central bank alone.” While the central bank, in addition to the rate cuts, has bought R30bn of government bonds in the secondary market, it has said this was done to aid liquidity in the market rather than influence the state’s cost of borrowing.
Central banks around the world have cut interest rates due to Covid-19 in 2020, with the Bank’s latest cut in July bringing the “As we navigate through this Covid-19 storm, the Reserve Bank will continue to deploy its tools, as appropriate, in accordance with its mandate, to provide support to the SA economy,” Kganyago said.
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