What are the duties of the South African Reserve Bank?

The SARB is also responsible for:

• issuing and destroying banknotes and coin;
• regulating and supervising financial institutions;
• managing the official gold and foreign reserves of the country;
• managing the national payments system;
• administering the country’s remaining exchange rate control systems;

What is the main function of the Reserve Bank?

The Reserve Bank’s responsibilities include formulating and implementing monetary policy, promoting financial stability, issuing banknotes, providing banking services to government, operating the high-value payments system, managing Australia’s foreign reserves and setting payments system policy.

What is the main reason for the South African Reserve Bank’s SARB operations in the financial markets?

The main reason for the operations of the SARB in the money market is to implement the Bank’s interest rate policy as determined by the Monetary Policy Committee, with the aim of achieving the SARB’s inflation target.

Who owns the Reserve Bank in South Africa?

South African Reserve Bank

How does the South African Reserve Bank maintain price stability?

The SARB uses interest rates to influence the level of inflation. To protect the value of the rand, the SARB uses inflation targeting, which aims to maintain consumer price inflation between 3\% and 6\%. The value of the currency is therefore protected relative to domestic consumer prices.

How can the South African Reserve Bank use the monetary policy?

Monetary policy is implemented by setting a short-term policy rate – the repo rate. This affects the borrowing costs of the financial sector, which, in turn, affect the broader economy. The repo rate is so called because banks give the SARB an asset, such as a Government bond, in exchange for cash.

Who controls the South African Reserve Bank?

Why do SARB hold reserves?

The SARB uses a cash reserve system to implement monetary policy. It creates a structural money market shortage so that banks have to come to the SARB to finance their minimum cash requirement. This enables the SARB to control the price of short-term money.

Why do South African Reserve Bank hold reserves?

Gold and foreign exchange reserves (customarily denominated in the major currencies) are the official public sector foreign assets that are readily available and typically held to: service South Africa’s foreign exchange liabilities; protect the economic well-being of South Africa in the event of an external shock.

How much is the South African Reserve Bank worth?

South African Reserve Bank

Where is the head office of South African Reserve Bank?

Pretoria, South Africa
South African Reserve Bank/Headquarters