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SARB debate unlikely to affect independence - economist

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Cape Town – Although the ANC at its recent policy conference bemoaned the fact that the South African Reserve Bank (SARB) is privately owned, changing this is unlikely to affect its independence or monetary policy in general, says BNP Paribas economist Jeffrey Schultz in a company note.

“The tabling of a proposal to nationalise the SARB rattled markets and the currency … [but] the SARB’s mandate is set out in the constitution with direction from National Treasury. So while there’s a risk of more public sector participation (or full nationalisation) in the bank’s shareholding in the coming years, its shareholders have no sway in setting monetary policy.”

On Wednesday when the news reached the markets, the rand fell by about 1.5% to R13.45 against the dollar, but pulled back to R13.38/$.

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