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South African Reserve Bank

Financial Markets 

In the execution of its mission, the Department has the following responsibilities:

  • Implementing monetary policy decisions of the Monetary Policy Committee (MPC).  This entails influencing short-term money market rates to be consistent with the repo rate set by the MPC.  This is done by creating a liquidity shortage in the money market which the banks have to refinance from the Bank, at the repo rate, or other penalty rates as applicable, through standing facilities.  Liquidity management also includes the usage of other open-market operations such as reverse repurchase transactions, SARB debentures, foreign exchange swaps, movement of public sector funds between the Bank and the market and facilities such as the averaging of cash reserves.
  • Participating in the spot and forward foreign exchange markets to service the foreign exchange needs of the Bank and its clients as well as for the management of money-market liquidity.
  • Acting as a funding agent of the Government by conducting bond and Treasury Bill auctions, participating in the formulation of debt management strategies and conducting surveillance over primary dealers in the government bond market.
  • Managing the investment portfolio of the Corporation for Public Deposits (CPD).
  • Promoting the effective functioning of the domestic financial markets and contributing to the Bank's financial stability mandate through effective market monitoring, gathering of market intelligence and ensuring the Bank's activities in the markets support financial stability.
  • Managing the country's official gold and foreign exchange reserves.
  • Managing relationships with domestic and foreign counterparties covering both trading and settlements.
  • Providing custody and settlement services to the Government and relevant counterparty banks.
  • Managing risks inherent in the management of gold and foreign exchange reserves, all market operations conducted by the Department, as well as all functions conducted on behalf of Government by the FMD.
  • Performing an accounting function for all transactions conducted by the Department in the domestic and foreign exchange markets as well as transactions related to its foreign reserves management functions in terms of the Reserve Bank Act and in alignment with the International Financial Reporting Standards (IFRS).
  • Providing market information and analyses to assist various Bank committees and the Governors' Executive Committee (GEC) in their decision-making processes.
  • Fostering relations with market participants and other stakeholders, in order to gather market intelligence for purposes of enhancing the Bank's understanding of market developments for effective decision making and to promote the image of the Bank and the country.


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