South African Reserve Bank (SARB) governor Lesetja Kganyago has joined a powerful international show of unity defending the independence of the US central bank, warning, by implication, that political interference in monetary policy threatens ordinary citizens far beyond America’s borders.
Kganyago is among a group of leading global central bankers who have publicly backed Jerome H. Powell, the chair of the Federal Reserve System, following mounting political pressure in the US over interest rates and inflation policy.
The statement, issued on January 13 under the banner of the European Central Bank, stresses that central bank independence is a “cornerstone of price, financial and economic stability” and must be protected in the interests of citizens.
Hands-off warning to politicians
While it does not name any political figures, the message is widely understood as a firm “hands off” warning to politicians who seek to influence central banks for short-term political gain.
“Chair Powell has served with integrity, focused on his mandate and an unwavering commitment to the public interest,” the statement reads. It added that he is held “in the highest regard” by his global peers.
For South Africans, Kganyago’s inclusion is significant. The SARB governor has long defended the independence of the Reserve Bank. Often in the face of domestic political criticism over interest rate hikes that are unpopular but aimed at controlling inflation and protecting the rand.
Economists have repeatedly warned that political control over monetary policy typically leads to runaway inflation, currency collapse and rising living costs, outcomes that hit the impoverished hardest.
Global central bank leaders
The global statement brings together central bank leaders from Europe, Africa, Asia and the Americas. They include the heads of the Bank of England, the Bank of Canada, the Reserve Bank of Australia and the Bank for International Settlements, often described as the “central bank of central banks”.
The group is drawing a line in the sand. Interest rate decisions should be based on economic data and long-term stability, not election cycles or political pressure.
For South Africa, where inflation, bond yields and currency confidence are closely watched by investors, Kganyago’s stance reinforces the message that the SARB remains aligned with global best practice.
The statement also signals that any successful political interference in the US could set a dangerous precedent worldwide. It may embolden governments elsewhere to weaken independent institutions.
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