One of the reasons why low inflation supports economic growth is because it helps to reduce interest rates over time, explains South African Reserve Bank Governor Lesetja Kganyago.
As the Governor of the South African Reserve Bank, I welcome debate on the part played by monetary policy in national development. But on the emotive topic of money, we should insist that our national discussion is informed by facts. All too often, public debate is framed by those who claim to speak for ‘the person in the street’ while their arguments suggest otherwise.
It’s on the basis of informed debate that our society can progress and millions of our fellow citizens can achieve a higher standard of living and a better quality of life. So, in the spirit of informed debate I shall share some evidence and analysis. At the outset, I would like to make a few general points about monetary policy.