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HANGING TOUGH

6th May 2022

By: Darlene Creamer

     

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Consumer inflation nudged the upper end of South Africa’s 3% to 6% target band in March when it reached 5.9%, and it is expected to rise further. In a context of low growth and high unemployment, questions will naturally arise about the wisdom of holding on to a target, which will required yet more rate hikes to meet. South African Reserve Bank governor Lesetya Kganyago’s answer will be that holding the bank accountable to the simple and realistic goal of price stability is surely preferable to “hundred-point plans, hazy aspirations and no consequences for failure”.

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