Moving inflation target will destroy confidence Reserve Bank has built
The Reserve Bank must continue to use the target band to its limits, allowing inflation to drift towards 6% and sustaining it there for a period of time
13 March 2019 - 05:05
In 2017/2018, the ANC and EFF called for the nationalisation of the SA Reserve Bank. Pundits are asking, is this a good call? Should a change of mandate be considered, i.e. from inflation targeting to employment targeting? It is important that, in all countries, the central bank is viewed as reliable, consistent and disciplined in the execution of its mandate. This helps to anchor inflation expectations, which in turn keeps inflation down. As such, any perceived lack of independence is massively problematic.
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