FAQ Calendar Search Today's Posts Mark Forums Read
Go Back   BizForums > Africa > Southern Africa
Home Viewpoints and Forecasting Forums UK Ireland South Africa
Southern Africa South Africa specific news feed

Reserve Bank unlikely to stabilise rand

Thread Tools Display Modes
Old 04-09-2014, 01:58 PM   #1
newsroom's Avatar
Join Date: Jun 2008
Posts: 1,155
newsroom is on a distinguished road
Art Reserve Bank unlikely to stabilise rand

While the rand is expected to remain volatile, the Reserve Bank is unlikely to intervene in the market to try to stabilise the currency, says Governor Gill Marcus.

Speaking at the European Economic and Financial Centre in London on Tuesday, the governor said the currency has followed a volatile trend and that this trend is expected to continue.

“While the exchange rate has been an important shock absorber for the South African economy, some concern has been expressed regarding its volatility. We have not attempted to intervene directly in the foreign exchange market, as we do not believe that such intervention would be effective, given the size of South Africa’s foreign exchange market, and our relatively low level of foreign exchange reserves of around US$50 billion,” she said.

The currency, which had touched five year lows, has made some ground after the central bank raised interest rates at its first meeting of the year in January.

The central bank said the surprise hike was the beginning of a moderate monetary tightening cycle.

Interest rates, noted the governor, cannot remain indefinite, even though the state of the country’s economy has justified accommodative interest rates.

“While such an accommodative stance has been considered appropriate given the developments in the real economy, pressures from the exchange rate and capital flows and the possible normalisation of monetary policy in the US imply that this stance cannot be maintained indefinitely,” she said.

At its meeting in March the reserve bank left rates unchanged.

However, this did not mean that “we blindly follow US monetary policy”, she said. -
newsroom is offline   Reply With Quote

Go Back  BizForums > Africa > Southern Africa

reserve bank, south africa

Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off

Forum Jump

All times are GMT. The time now is 02:29 PM.

Powered by vBulletin®
Copyright ©2000 - 2019, Jelsoft Enterprises Ltd.
© 2008 - 2015 TheBizSense All Rights Reserved