South African Reserve Bank Governor Tito Mboweni told I-Net Bridge on Wednesday that there is a need for more frequent Monetary Policy Committee (MPC) meetings in order to take account of the rapid changes taking place every day in the global economic and financial environment, and their impact on South Africa’s economy and its outlook for inflation, growth and jobs.
This comes on news today that the MPC will meet on March 23 and 24 ahead of the previously scheduled April 15 and 16, and then at close to monthly intervals thereafter.
Mboweni said that the MPC had been debating for some time the need for more regular meetings.
“Our biggest concern is that global economic and financial conditions have changed for the worse, and it is therefore folly to think that South Africa will not experience an impact,” he said.
Mboweni said it was decided to have the meetings more frequently than the previous once every two months, and that “frequently” meant at least one a month. According to the new schedule of MPC meetings released today, a total of 10 meetings will be held this year.
Mboweni said that while the overall objective remains price stability, the MPC does not operate in a “vacuum”.
He said it would take the global conditions into account as well as the fact that global inflation is due to come down. “But it [global inflation] will not be like a waterfall,” he said.
He said that the policy would take expectations of “significantly” lower inflation into account. — I-Net Bridge