Lesetja Kganyago: Remarks - annual dinner for the Heads of Foreign Missions accredited in South Africa
Remarks by Lesetja Kganyago, Governor of the South African Reserve Bank, at the annual dinner for the Heads of Foreign Missions accredited in South Africa, South African Reserve Bank, Pretoria, 9 July 2026.
Lesetja Kganyago, Governor of the South African Reserve Bank, addressed the annual dinner for Heads of Foreign Missions accredited in South Africa. It felt like a lifetime since their last meeting seven years prior. The source quote of Vladimir Lenin is famously attributed to noting that there are periods of inaction and moments where decades occur rapidly.
Since 2019, the world has witnessed numerous of those rapid weeks. In addition to a global pandemic, there has been escalating conflict across Ukraine and the Middle East. 2022 saw the highest global inflation surge in a generation, followed by a second wave. Artificial intelligence has evolved rapidly, creating accurate models that discuss a wide range of topics.
A short-lived trillionaire was also reported, although it lasted only a week. Despite the drastic changes, some aspects have remained consistent, such as the focus on multilateralism and central bank independence, with concerns about trade wars and populist attacks on institutions still relevant. The global economy has shown surprising resilience despite these challenges.
The AI boom has driven investment, supported trade, and generated wealth through stock market valuations. Loose fiscal policy settings in major economies have boosted near-term output, although there are sustainability concerns. Openness to trade has remained, with no retaliatory tariff spiral. Emerging markets have also been resilient, growing at around 4% on average, accounting for over 60% of global output.
South Africa's journey since 2019 has been one of ups and downs, including the impact of COVID-19 and domestic shocks like electricity load-shedding. However, the past two years have brought positive changes, such as credit rating upgrades and the exit from the Financial Action Task Force's greylist. South Africa's growth has steadied, with six consecutive quarters of expansion since 2024.
Key sectors have stabilized, and load-shedding has ended. The government's sovereign debt is now expected to stabilize in the current year. Monetary policy has seen a new inflation target of 3%, replacing the previous 3-6% range. Despite initial optimism, a supply shock has led to inflation exceeding the target, requiring rate hikes.
However, the recent decline in oil prices may help bring inflation back to the target more quickly, despite ongoing risks. Overall, South Africa's reform efforts have shown progress, with falling electricity costs affecting government borrowing costs across the yield curve.
Written by urgent.news from BIS Central Bank Speeches's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
