SA may exploit ‘cheap’ dollars to build reserves – Kganyago

South African Reserve Bank (Sarb) Governor Lesetja Kganyago has urged credit rating companies to recognise the nation’s improved financial position, and indicated that officials may use the rand’s strength to boost reserves if the chance arises.

South Africa operates a free-floating exchange rate and does not target the currency, but the central bank would consider taking advantage of ‘cheap’ dollars or euros to augment reserves.

“If the opportunity avails itself that we can continue to increase our reserves, we would do that,” Kganyago told investors at the SA Tomorrow conference in Johannesburg on Tuesday.

“Suffice to say that the level of reserves that we have now, considering a number of metrics, is actually adequate.”

Investors have warmed to South African assets in recent months – helped in part by Kganyago’s announcement in July that the Sarb would aim for the bottom of its 3%-6% inflation target – driving government bond