South Africa Treasury Vows to Respect Central-Bank Independence

(Bloomberg) -- South Africa’s National Treasury respects the independence of the nation’s central bank and will refrain from commenting on monetary policy. And the Reserve Bank promised to do the same for fiscal policy.

The institutions put out a joint statement on Thursday following comments in Business Day newspaper by Deputy Finance Minister David Masondo, appointed in May, suggesting interest rates may be too high. That broke a long-standing unwritten rule for the policy makers not to criticize each other.

“The Ministry of Finance would under normal certain circumstances not comment on the monetary-policy stance or interfere in monetary-policy decision making or decisions of the SARB,” they said. “That is the role of the SARB. The SARB does not comment on fiscal policy and tax matters.”

Finance Minister Tito Mboweni, a former Reserve Bank head, met with central bank Governor Lesetja Kganyago earlier in the day.

To contact the reporter on this story: Gordon Bell in Johannesburg at gbell16@bloomberg.net

To contact the editor responsible for this story: Rene Vollgraaff at rvollgraaff@bloomberg.net

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