“The reappointment of governor Lesetja Kganyago for a further five years as head of the South African Reserve Bank (SARB)  is a welcome and highly confidence-building decision at a tough time for the South African economy.”

This is according to Prof Raymond Parsons, well-known economist and academic from the North-West University (NWU) Business School.

“Not only is Lesetja a widely respected central banker both nationally and internationally, but his reappointment sends a strong message that the independence of the central bank is being upheld and reinforced.”

According to Prof Parsons it remains essential that the SARB continues to be seen with enough autonomy and credibility to maintain a stable financial environment in which the economy can achieve maximum growth, especially when the country has to boost investor confidence.

He says the filling of the two deputy governor posts by well-qualified individuals is also welcome, now bringing the Monetary Policy Committee (MPC) up to its full strength of seven members.

“The regular decisions by the MPC on monetary policy in general and interest rates in particular will continue to enjoy wide debate and interrogation. In June, the MPC indicated a preparedness to cut interest rates, suggesting that inflationary trends over the last few months meant that monetary policy had not been as accommodative as it could have been over that period.

During its meeting next week, the MPC should see whether there will indeed be a move towards lower interest rates, given the latest domestic and global economic trends pointing in that direction.”