In exactly a week, it will be five months since the last time Reserve Bank governor Lesetja Kganyago delivered an interest rate cut. While he gave a fairly optimistic outlook, he did acknowledge that inflation had probably reached the low point of the current cycle, and so it has come to pass. What Kganyago couldn’t foresee was the fate awaiting the rand. At levels prevailing at the time, the central bank’s models assessed the rand to be "somewhat overvalued", with the governor saying further strengthening potential was limited. Not only has the rand not strengthened since those days, it has collapsed. The reasons vary from US President Donald Trump’s trade war rhetoric to domestic policies about land expropriation. The Land Bank, which presented its financial results on Monday, gave some interesting comments on the latter, highlighting the dangers that lurk when populism overtakes evidence-based research as the basis for policy change. The most recent trigger for the rand’s fall ha...

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