An analysis of the effectiveness of inflation targeting monetary policy framework in South Africa

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dc.contributor.authorSheefeni, J. P. S.
dc.contributor.authorMakuvaza, Leonard
dc.contributor.authorNyambe, Jacob M.
dc.date.accessioned2021-03-11T07:53:14Z
dc.date.available2021-03-11T07:53:14Z
dc.date.issued2019
dc.description.abstractThis study is premised on investigating the effectiveness of inflation targeting in South Africa. The methods of analysis include the Vector Autoregressive model (VAR), the unit root test and cointegration test. The analysis was conducted with the use of EViews version 9. The findings from the study revealed that the response of inflation is not consistent with the Taylor rule hence increases in the repo rate meant to reduce inflation actually increase the inflationary pressures in the economy. This is due to the composition of the Consumer Price Index. Housing constitutes the largest weight on the CPI hence this has an impact on how the Repo rate affects inflation. The autoregression model of inflation showed that the sum of the coefficients is less than one (0.965) showing that inflation targeting has effectively reduced the persistence of inflation in South Africa. Thus monetary framework in South Africa seems to be effective and should thus be advanced for wider economic benefit.en_US
dc.identifier.citationMakuvaza, L., Nyambe, J., & Sheefeni, J. P. (2019). An Analysis of the Effectiveness of Inflation Targeting Monetary Policy Framework in South Africa. Journal of Economics, Management and Trade, 24(6), 1-9. https://doi.org/10.9734/jemt/2019/v24i630180en_US
dc.identifier.issn2456-9216
dc.identifier.uri10.9734/JEMT/2019/v24i630180
dc.identifier.urihttp://hdl.handle.net/10566/5980
dc.language.isoenen_US
dc.publisherJournal of Economics, Management and Tradeen_US
dc.subjectInflation targetingen_US
dc.subjectMonetary aggregateen_US
dc.subjectNominal exchange rate.en_US
dc.subjectSouth Africaen_US
dc.subjectPolicy frameworken_US
dc.titleAn analysis of the effectiveness of inflation targeting monetary policy framework in South Africaen_US
dc.typeArticleen_US

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