Nene: Inflation targeting will remain

Excerpt from the Address by the Deputy Minister Of Finance: Nhlanhla Nene on the impact of the budget on the transformation of the economy, 5 March – Bull Nose Maponya Mall Soweto

Sound policy foundations
... 
Part of South Africa’s success over the last decade can be attributedto the stabilising influence of the Reserve Bank’s inflation targeting policy. This policy will remain in place, although we will establish and maintain an open dialogue on this policy stance with our social partners. Part of this dialogue will no doubt require the Reserve Bank to demonstrate that inflation targeting necessarily takes into account a broad set of factors such as growth, employment and exchange rates. Price stability is important to people who have an income that cannot be augmented by other means when things go bad. Keeping inflation low is also an important part of ensuring a competitive real effective exchange rate, but this alone cannot raise our productivity. Competitiveness is driven over time by improving skills, reducing the costs of doing business, more efficient logistics systems and higher investment ...