South African Reserve Bank Governor Lesetja Kganyago announced ... "Headline CPI inflation is expected to peak at 5.4% in the first quarter of 2020 and settle at … The COVID-19 outbreak is having major health, social and economic impacts, which presents challenges in forecasting. Policy; Governance Structure; Framework; Risk Management and Compliance Department; Processes; Approach And Methodology ; Whistle-blowing@SARB; Reserve Bank Shares. Neutral citation: The South African History Archive Trust v The South African Reserve Bank and Another (Case no 17/19) [2020] ZASCA 56 (29 May 2020) BANK, L KGANYAGO SECOND RESPONDENT . Army to Help South African Police Deal With Attacks on Trucks? Third, the end-of-day lending rate on the Standing Facility was reduced from repo plus 100 basis points to the repo rate. The SARB has a statutory mandate to protect and enhance financial stability in South Africa by monitoring global and domestic conditions, using various indicators to identify the risks and vulnerabilities which may impact on the financial system. Image: Reuters. To ensure the continuity of the cash supply chain, an industry forum was established to monitor the availability of cash in circulation in the economy, along with the ongoing production of new currency. These response measures have helped to ease global financial conditions, allowing governments and companies to continue accessing domestic and international financial markets, and thus being able to sustain business operations and provide support to households. He assumed the Governorship of the South African Reserve Bank on 9 November 2014, following the expiry of the term … The South African Reserve Bank (SARB) has cut the repo rate by 25 basis points. Fugitive Cleric Bushiri Now Wanted For Rape in South Africa, Tight Lockdown Rules as COSAFA U-20 Gets Underway in South Africa, New Surveys May Shed Light On South Africa's Covid-19 Epidemic, New Nests are Helping African Penguins Breed, As Covid-19 Surges, South Africa Cracks Down on Coastal Metro. For our forecast, the Brent crude oil price is expected to average $42 per barrel in 2020 and $45 per barrel in 2021, very close to the March forecast. In a webinar hosted by the Cape Town Press Club, the governor addressed the audience in an animated fashion, comparing the … Two new deputy governors begin their tenures with the South African Reserve Bank today and bring a wealth of experience from both inside and outside of civil service. Second, we introduced a three-month term repo facility, which is offered in addition to the weekly main refinancing operations. Nigerian President Appoints New Civil Defence Boss. Central banks around the world responded swiftly by lowering interest rates and providing liquidity to maintain market functioning. Governor Lesetja Kganyago: Lecture at Wits School of Governance 18 Jun 2020 Lecture by Lesetja Kganyago, Governor of the South African Reserve Bank, at the Wits School of Governance in Johannesburg The South African Reserve Bank, the coronavirus shock, and ‘the age of magic money’ By submitting above, you agree to our privacy policy. South African Reserve Bank Governor Lesetja Kganyago listens during an interview in New York City, in New York, US, on November 9, 2017. Previous Governors; Legislation; Mandate; Functions. Lesetja Kganyago was born in Johannesburg, South Africa in 1965. Lesetja Kganyago was appointed Governor of the South African Reserve Bank (SARB) with effect from 9 November 2014. The South African Reserve Bank has a responsibility to maintain price stability and look after the economy. Slightly lower oil prices and sharply lower domestic growth pulls down on the inflation forecast, while negative global sentiment and fiscal risks have led to equally aggressive currency depreciation and upside pressure on inflation. Lesetja Kganyago was reappointed as the Governor of the South African Reserve Bank (SARB) for a second term in November 2019; his first was effective from 9 November 2014. In line with a partial global recovery, we expect economic activity in South Africa to start recovering as lockdown measures are gradually eased. This was due to falling export demand, weak business confidence and investment, and the return of load-shedding. Global producer price inflation has decelerated. South African Reserve Bank stands ready to provide support to the economy within its mandate,” Kganyago said. During the past year, the main risks to financial stability were identified as weak and deteriorating domestic macroeconomic conditions, government's fiscal position, cyberattacks on key financial infrastructures, and climate change. Expectations of future inflation broadly remain around the mid-point of the band, although market-based expectations have recently ticked up in response to the depreciation of the currency. AllAfrica is a voice of, by and about Africa - aggregating, producing and distributing 900 news and information items daily from over 130 African news organizations and our own reporters to an African and global public. The COVID-19 pandemic has placed all of these risks at the centre of the financial system. The impacts will be particularly severe for small businesses, and individuals with earnings in the informal sector. The SARB acted swiftly to ensure the continued smooth functioning of financial markets. The next statement of the Monetary Policy Committee will be released on 21 May 2020. In addition to continued easing of interest rates, the Bank has taken steps to ensure adequate liquidity in money and government bond markets and to ease capital requirements to free capital for onlending by financial institutions. Monetary policy however cannot on its own improve the potential growth rate of the economy or reduce fiscal risks. COVID-19 and South African Reserve Bank operations. The central bank kept the repo rate at … Each of these steps make more capital available to households and firms. A House Divided - South African Ruling Party Facing Major Split? As the pandemic persists, it is clear that some sectors of the economy, like travel and recreation, will experience a prolonged drop in demand. Within the central banking community, the actions of major global central banks have provided space for the SARB to respond to our unique domestic conditions. Police Units Raid Offices of South African Lottery Commission, South African Court Sets Aside Revenue Service's 'Rogue' Report. The SARB continually monitors for signs of stress in the system, and will continue to act as appropriate to mitigate any risks. Our projections for 2021 and 2022 are for GDP to recover to 3.7% and 2.8% respectively. There was a problem processing your submission. Government of South Africa (Pretoria) press release. South Africa’s central bank held its benchmark interest rate for a second straight meeting and signaled increases next year, even as its forecasts … Immediately prior to her appointment to that position, she served as an adviser to the Governor of the bank, since 10 February 2018. Current estimates from the IMF show global growth contracting this year by about 2.9%.Economic contractions are expected to be deepest in the second quarter of 2020, with some recovery expected in the third quarter of the year. While second-quarter GDP data are not yet available, there is sufficient evidence to confirm that the lockdown has exerted a drag on economic activity. “The Monetary Policy Committee (MPC) has decided to cut the repo rate by 25 basis points, taking it to 3.50% per annum, with effect from 24 July 2020. The SARB expects headline inflation to average 3.4% in 2020, and 4.3% in both 2021 and 2022. The South African Reserve Bank’s Monetary Policy Committee has voted to cut the country’s rates by a further 25 basis points. Migrants Targeted Over Roles in South African Informal Sector? Let me conclude with some key points for reflection in the ongoing discourse about the role of the SARB in the economic recovery. Lower longer-term inflation outcomes are important for maintaining purchasing power, containing the costs of living and of doing business, and supporting our country's global competitiveness. There are tough choices for us to make as a society. The European Central Bank (ECB) has made similar commitments.Emerging and developing economies generally have less policy space available and credit is more expensive, and for this reason, the International Financial Institutions (the IMF, the World Bank) and others have made available extraordinary levels of emergency financial support. The South African Reserve Bank (SARB) is the central bank of South Africa. We have also prioritised the implementation of medical and wellness protocols throughout the South African Reserve Bank Group (SARB Group). The slight drop in inflation may provide room for the South African Reserve Bank to reduce rates further in November. Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. The Bank’ s headline consumer price inflation forecast averages 3.6% for 2020,  4.5% for 2021, and 4. THE president of Zambia, Edgar Lungu, on Saturday dismissed Bank of Zambia governor Denny Kalyalya without giving a reason for the surprise move. Lower oil prices will reduce petrol prices in the near term. The South African rand depreciated by 22% between February and the end of April. Revisions to liquidity management operations comprised four elements. Since the 2008/2009 global financial crisis, South Africa has implemented reforms to strengthen its regulatory framework for financial institutions and improve the resilience of the financial system. Real GDP had contracted at an annualised rate of 0.8% and 1.4% respectively in the last two quarters of 2019. More than R30 billion worth of government bonds has been bought since the commencement of the programme in March this year. The South African Reserve Bank (Sarb) decided to keep the repo rate steady at 3.5% on Thursday, following the conclusion of its final Monetary Policy Committee (MPC) meeting for 2020 – a … Over the same period, the yield on the 10- year government bond rose by more than 200 basis points, and money market liquidity was thin. Longer- term inflation expectations have continued to decline towards 4.5%, which is the midpoint of the inflation target range. The SARB expects that the lockdown will cause output to contract by 7.3% in 2020. Get the latest in African news delivered straight to your inbox. SA Reserve Bank has scope for another interest rate cut this week By Ed Stoddard • 16 November 2020 Lesetja Kganyago, governor of the South African Reserve Bank. Weaker domestic growth and greater fiscal risks have resulted in a downgrade by Moody’s credit rating agency and confirmation of a negative outlook by Fitch, a weaker currency and higher borrowing costs for government, banks and firms. Governor Kganyago has more than 20 years of experience in formulating and implementing public policy, having spent this time at the central bank and at the National Treasury. Motion Against South Africa's Ramaphosa a Looming 'Iceberg'? In its latest update on the World Economic Outlook, the International Monetary Fund (IMF) estimates that global gross domestic product (GDP) will contract by about 4.9% in 2020. In addition, the prolonged period of remote working has increased cybersecurity risks. At the same time, the borrowing rate on the Standing Facility, which is the rate at which the SARB absorbs liquidity, was also adjusted lower. 4% in 2022. Inflation has moderated since the beginning of the year. The SARB's policy responses are an important element of providing support to the economy. The World Bank highlights that this will be the deepest global contraction since 1945, with a record 93% of the world's economies expected to experience economic contraction this year. As usual, the repo rate projection from the QPM remains a broad policy guide which can change from meeting to meeting in response to changing data and risks. In South Africa, the COVID-19 crisis appeared at a time when our domestic economy was already vulnerable and in a technical recession. Since March, the majority of our staff has been working remotely. Governor of the South African Reserve Bank, at the University of the Free State Bloemfontein 4 March 2020 Sound policy is an imperative for growth Good evening, ladies and gentlemen. And while there are signs of recovery in some sectors, much uncertainty remains. Fiscal authorities have contributed by delivering stimulus packages that are estimated to be larger than the response to the global financial crisis of 2008 and 2009. Created Date. Business and consumer confidence has also fallen as uncertainty levels reached new highs. SOUTH AFRICAN RESERVE . The uncertainties of the crisis have led to extremely high volatility in financial asset prices, with sharp and deep market sell-offs followed by a partial recovery. Thank you for inviting me here today to speak about the South African economy. Chairman. Consumer price inflation fell to as low as 2.1% year on year in May, down from 4.6% three months earlier. Consequently, the SARB's inflation forecast now sees core inflation remaining within the lower half of the target range for the remainder of the forecast period, vthat is until the end of 2022. He holds a MSc in Economics from SOAS London University and a BCom degree in Economics and Accounting from UNISA. The MPC has reduced the repo rate by a cumulative 275 basis points, to 3.50% per annum. Lesetja Kganyago, governor of South Africa's central bank, speaks during a news conference following a Monetary Policy Committee meeting in Pretoria, South Africa… Both the supply and demand effects of this extension reduce growth and deepen it in the short-term, as businesses stay shut for longer and households with income spend less. This decline accelerated to an annualised rate of 2.0% in the first quarter of 2020, despite the nation-wide lockdown only coming into effect in the last few days of March. Some factors will support growth, including where businesses are able to open under the current rules, new jobs being created to service more needs under the lockdown, and sustained government spending, both through normal operations and crisis-related spending and programmes. South Africa’s central bank said on Wednesday the coronavirus had resulted in far reaching risks to financial stability and banks’ profitability would suffer, but lenders were in a good … ManagingDirector. SARB’s new deputy governors Policy; Governance Structure; Framework; Risk Management and Compliance Department; Processes; Approach And Methodology ; Whistle-blowing@SARB; Reserve Bank Shares. Opening address by Mr Lesetja Kganyago, Governor of the South African Reserve Bank, at the fourth Annual Distributed Sovereign Debt Research and Management Conference University of Pretoria, Pretoria, 7 September 2020. JOHANNESBURG--The South African Reserve Bank on Thursday kept its main repo rate at 3.5%, even as it forecast that Africa's most developed economy will shrink 8% this year. While there is limited information to assess the impact of interest rate adjustments and other regulatory measures, the decline in indicators of bond market frictions and the improvements in money market liquidity conditions testify to the positive impact of the SARB's liquidity management measures. The SARB has indicated its willingness to offer longer-term repo facilities of up to 12 months, subject to liquidity conditions in the market. The South African Reserve Bank has a responsibility to maintain price stability and look after the economy. Lesetja Kganyago (born 7 October 1965) is a South African economist and central banker. “Lower longer-term inflation outcomes are … It was established in 1921 after Parliament passed an act, the "Currency and Bank Act of 10 August 1920", as a direct result of the abnormal monetary and financial conditions which World War I had brought. 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Credit risk has risen back to 2008 levels and about R100 billion of local assets have been sold by non-resident investors. South African Reserve Bank governor Lesetja Kganyago in Cape Town, South Africa, on Aug. 1. The South African Reserve Bank announces the interest rate decision on Thursday. Since the March meeting of the Monetary Policy Committee (MPC), the Covid-19 pandemic has spread globally and its impact is being felt through all economies. Will the Music Stop for South African Live Performers? South African Reserve Bank (Sarb) governor Lesetja Kganyago announces the latest decision on interest rates in SA. The timing and size of these contradictory impulses suggests that they are not perfectly offsetting, with weaker inflation in the near term likely giving way to higher inflation later in the forecast period. The decision was unanimous. This measure is meant to discourage banks from depositing money at the SARB, and to encourage money market liquidity. This takes the total cut in 2020 … This will likely also increase job losses, with further consequences for aggregate demand. All Rights Reserved. As we move towards economic recovery, the opening up of global trade channels will be important for South Africa as a small open economy. Governor of the South African Reserve Bank Lesetja Kganyago is suing Nelson Mandela Bay ANC councillor Andile Lungisa for defamation of character. For example, mining and manufacturing production plunged by 37% and 44% month on month, respectively, in the month of April. Government's debt issuance is higher; the deteriorating economic conditions have increased the credit risks faced by financial institutions; periods of market stress and volatility have placed a higher strain on market infrastructures. Monetary policy can ease financial conditions and improve the resilience of households and firms to the economic implications of Covid-19. The South African economy is likely to recover to pre-crisis levels at the end of 2021 or 2022, said the deputy governor of the South African Reserve Bank (SARB) Fundi Tshazibana on Wednesday while speaking at the Absa Annual Fixed Income Conference. Photo: mike hutchings/Reuters Aug. 29, 2017 12:15 pm ET 27 May 2020, 4:16 PM | Reuters | @SABCNews. While major economies in Asia and Europe appear to be on the road to recovery, the United States (US) and most of the emerging world are still very much in the midst of the crisis. We operate from Cape Town, Dakar, Abuja, Johannesburg, Nairobi and Washington DC. Policy responses to the crisis have generally been robust, with the magnitudes dependent on the degree of policy space available to countries. Lesetja Kganyago, Governor, South African Reserve Bank. Many countries - especially in Africa, Latin America and South Asia - are still experiencing increases in new COVID-19 infections. There are good reasons to have some prudential restrictions on capital leaving the country, especially savings in retirement funds and the reserves of insurance companies, Mr Kuben Naidoo, South African Reserve Bank (SARB) deputy governor and chief executive of the Prudential Authority, has said. The COVID-19 pandemic has demonstrated the extent of interconnectedness of the global economy through production value chains, trade, financial markets, travel, and the exchange of knowledge. Against this backdrop, the MPC decided to cut the repo rate by 100 basis points. The overall risks to the inflation outlook at this time appear to be to the downside. The US Federal Reserve has taken further steps to expand its balance sheet. Expected impact of the South African Reserve Bank's response. As a consequence, the high-frequency indicators suggest that the gradual lifting of lockdown restrictions in the major economies (first China, then Europe) has seen a rebound in manufacturing production and retail spending. First, we put in place Intraday Overnight Supplementary Repurchase Operations (IOSROs) aimed at providing liquidity support to commercial banks. The faster the global economy recovers from the crisis, as China appears to be gradually doing now, the more positive growth spillovers will strengthen for South Africa, including healthy price levels for commodity exports. The relaxation of certain regulatory measures has enabled banks to provide support to households and businesses through continued lending activities, alongside the government loan guarantee scheme. Nonetheless, prices for many commodities have fallen as a result of weaker demand globally. As we navigate through this COVID-19 storm, the SARB will continue to deploy its tools, as appropriate, in accordance with its mandate, to provide support to the South African economy. The COVID-19 pandemic has placed significant pressure on the global as well as domestic economies, and the livelihoods of citizens. To place our economy on a sound and sustainable growth path, the SARB stands ready to provide support to the economy within its mandate. Inflation expectations for 2020 are at around 3.9%, the lowest in recorded history. The SARB initiated a process in January to monitor the effects of the pandemic on its operations, including the operations of its subsidiaries. This is not a time to despair. Kristalina Georgieva. South African Reserve Bank Governor Lesetja Kganyago listens during an interview in New York City, in New York, US, on November 9, 2017. Fundi Tshazibana. By Suren Naidoo 19 Nov 2020 15:10 Lesetja Kganyago, governor of the South African Reserve Bank. Lesetja Kganyago was reappointed by President Cyril Ramaphosa as the Governor of the Reserve Bank for a period of five years, with effect from 9 November 2019. We mark the 100th annual Ordinary General Meeting (AGM) of the South African Reserve Bank (SARB) at a time when the world is facing one of the most disruptive and challenging crises in recent memory. Electricity pricing remains a concern but has moderated somewhat. The Covid-19 outbreak will have a major health and social impact, and forecasting domestic economic activity presents unprecedented uncertainty. The global policy response has matched the magnitude of the crisis. Neither is it a time to venture into policies or instruments that have proved a failure in economic history. As noted earlier, while advanced economies conduct exceptionally accommodative policies, global financing conditions are no longer supportive of emerging market currency and asset values. 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