Kganyago: I thrive on a challenge

The new Reserve Bank governor says improving SA's slow growing economy isn't going to be an easy task.

Lesetja Kganyago is congratulated by outgoing SA Reserve Bank governor Gill Marcus (R) after it was announced by President Jacob Zuma (L) that he will become the new SA Reserve Bank governor in Pretoria on Monday, 6 October 2014. Picture: Sapa.

JOHANNESBURG - Newly appointed reserve bank governor Lesetja Kganyago says while improving South Africa's slow growing economy is not going to be an easy task, he thrives on a challenge.

On Monday, President Jacob Zuma announced Kganyago will succeed Gill Marcus next month when she steps down after five years at the helm.

Economists have applauded Zuma on the appointment, saying Kganyago brings with him a wealth of experience and will move the Central Bank forward.

Kganyago says he's positive about the journey ahead.

On Tuesday, Kganyago told The Money Show that he thrives on challenges.

"There is the dilemma of inflation that is higher than our target and very low growth. I will be taking the challenge head-on."

Kganyago argued that the monetary policy is effective because South Africa has adopted inflation targeting as a monetary policy framework.

Asked whether the limits of the policy in terms of boosting growth, the new governor said interest rates in the country are still low.

"The interest rate policy we have is still accommodating. The burden of lifting our potential growth rate can't be carried by the policy alone. To raise the potential growth rate,we need a structural economy."

Kganyago is the country's third governor since 1994. The governor-elect has worked in the country's public service since 1996, beginning his career in the national treasury.