EDITORIAL: Bank takes aim at inflation
Reserve Bank wants lower inflation goal — but the Treasury isn’t convinced
After four years of debate, the Reserve Bank has gone into overdrive in its push to have the inflation target lowered from 4.5% to 3%. With consumer inflation below 3% for the past three readings, the time is right to make the move, it argues, with the country set to reap significant welfare, fiscal and economic benefits.
But the National Treasury, while conceding there is a case for revising the target, appears reluctant to make the leap. This misalignment between the Bank and the Treasury is unfortunate — not least because, though the Bank can (in theory) move without the Treasury’s approval, doing so would send out mixed messages...
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