{
  "title": "The Relative Merits and Implications of Inflation Targeting for South Africa",
  "publication": "IMF Working Papers, August 1, 1999",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/30/the-relative-merits-and-implications-of-inflation-targeting-for-south-africa-3255",
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  "summary": "This paper describes the main elements of inflation targeting, reviews its pros and cons, and examines the experiences thus far in countries using this framework.",
  "sections": [
    {
      "heading": "Summary",
      "content": "- This paper describes the main elements of inflation targeting, reviews its pros and cons, and examines the experiences thus far in countries using this framework.\n- It discusses the implications and relative merits of such a framework for South Africa.\n- Conclusion: it would be feasible and desirable for South Africa to adopt explicit inflation targeting.\n- Potential benefits: reduce uncertainties about the Reserve Bank’s objectives and enhance the transparency of monetary policy.\n- Preconditions noted: further experience with the operational aspects of the repurchase system and a refinement of the inflation forecasting framework may be needed before inflation targeting is implemented."
    },
    {
      "heading": "Major Findings and Analysis",
      "content": "- Inflation targeting framework elements and international experiences are reviewed to assess applicability for South Africa.\n- The framework’s pros and cons are evaluated in light of country experiences using inflation targeting.\n- Feasibility assessment: explicit inflation targeting is judged feasible for South Africa.\n- Desirability assessment: adoption is judged desirable due to expected gains in clarity of objectives and transparency."
    },
    {
      "heading": "Policy Implications and Recommendations",
      "content": "- Adopt explicit inflation targeting to:\n  - Reduce uncertainties about the Reserve Bank’s objectives.\n  - Enhance the transparency of monetary policy.\n- Prior actions recommended before implementation:\n  - Gain further experience with the operational aspects of the repurchase system.\n  - Refine the inflation forecasting framework."
    },
    {
      "heading": "Subject Areas and Keywords",
      "content": "- Subject: Banking, Exchange rates, Foreign exchange, Inflation, Inflation targeting, Monetary policy, Monetary policy frameworks, Monetary policy instruments, Prices\n- Keywords: Africa, core inflation, Exchange rates, forecasting framework, Inflation, Inflation Targeting, inflation targeting country, inflation targeting economy, inflation targeting framework, inflation-targeting central banks, introduction of the inflation targeting regime, monetary policy, Monetary policy frameworks, Monetary policy instruments, South Africa, WP\n\n---\n\n Content in this bundle\n\n- The Relative Merits and Implications of Inflation Targeting for South Africa - WP/99/116\n  - The Relative Merits and Implications of Inflation Targeting for South Africa - WP/99/116 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - The Relative Merits and Implications of Inflation Targeting for South Africa - WP/99/116 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/30/the-relative-merits-and-implications-of-inflation-targeting-for-south-africa-3255"
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    "Authors: Gunnar Jonsson",
    "Published: August 1, 1999",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451853919.001",
    "This paper describes the main elements of inflation targeting, reviews its pros and cons, and examines the experiences thus far in countries using this framework.",
    "It discusses the implications and relative merits of such a framework for South Africa.",
    "Conclusion: it would be feasible and desirable for South Africa to adopt explicit inflation targeting.",
    "Potential benefits: reduce uncertainties about the Reserve Bank’s objectives and enhance the transparency of monetary policy.",
    "Preconditions noted: further experience with the operational aspects of the repurchase system and a refinement of the inflation forecasting framework may be needed before inflation targeting is implemented.",
    "Inflation targeting framework elements and international experiences are reviewed to assess applicability for South Africa.",
    "The framework’s pros and cons are evaluated in light of country experiences using inflation targeting.",
    "Feasibility assessment: explicit inflation targeting is judged feasible for South Africa.",
    "Desirability assessment: adoption is judged desirable due to expected gains in clarity of objectives and transparency.",
    "Adopt explicit inflation targeting to:",
    "Prior actions recommended before implementation:",
    "Subject: Banking, Exchange rates, Foreign exchange, Inflation, Inflation targeting, Monetary policy, Monetary policy frameworks, Monetary policy instruments, Prices",
    "Keywords: Africa, core inflation, Exchange rates, forecasting framework, Inflation, Inflation Targeting, inflation targeting country, inflation targeting economy, inflation targeting framework, inflation-targeting central banks, introduction of the inflation targeting regime, monetary policy, Monetary policy frameworks, Monetary policy instruments, South Africa, WP",
    "**The Relative Merits and Implications of Inflation Targeting for South Africa - WP/99/116**"
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