By Prinesha Naidoo and Ana Monteiro.

South Africa’s top money managers say cash is a bad place to station money given the downward trajectory in global interest rates and that investors should look to emerging markets for opportunities.

With global interest rates at multi-year lows, cash doesn’t offer compelling returns right now, Alexandra Nortier, the co-head of wealth management at Investec’s wealth and investment unit, said at the inaugural Bloomberg Africa Business Summit in Johannesburg Tuesday.

Speaking on the same panel, Chantal Marx, head of investment research at FirstRand’s FNB Wealth and Investments unit, echoed the view, saying “I don’t think you want to be in cash right now, given where interest rates are.”

Central banks have been lowering borrowing costs in response to a slowdown in consumer-price inflation. Already, emerging-market assets have been among the biggest winners this year, thanks in part to President Donald Trump’s tariffs — a trend that may well continue.

“We could be heading toward an era where emerging markets are in vogue,” Stanlib Asset Management chief executive officer Derrick Msibi said at the same panel.

In South Africa, policymakers should capitalise on newfound optimism about the country’s prospects, including its removal from a grey list by a top global anti-money-laundering watchdog, a credit-rating upgrade by S&P Global Ratings and the formal adoption of a 3% inflation target, the panellists said.

They should also demonstrate greater commitment to deliver growth-enhancing reforms to attract more global investors, Msibi said. The nation’s gross domestic product has expanded by an average of less than 1% annually over the past decade.

“Markets are generally forward-looking and they’re priced for what they think is going to happen in the future,” Msibi said. “South African equities look relatively cheap but the fact is they’re relatively cheap for a reason and part of that is because we’re still unclear about whether we can break out of this low-growth trap.”

While local investors seem pleased with progress on fiscal responsibility, as evidenced by Finance Minister Enoch Godongwana’s medium-term budget policy statement, foreigners remain sellers of local assets, he said.

© 2025 Bloomberg.