South African finance minister has not yet announced plans to reduce the inflation target

Enoch Godongwana, the finance minister of South Africa, stated on Friday that he had no plans to announce a reduced inflation target for the central bank at the mid-term budget, despite the expectation that he would.

His remarks were made the day after the central bank said that, although Godongwana had not yet approved a formal shift to the current 3%–6% target range, it would henceforth aim for 3% inflation rather than 4.5%.

The finance minister is ultimately in charge of setting the goal.

Minister Godongwana said in a statement that “any changes to our inflation-targeting framework will follow the established consultation process.”

“This means comprehensive consultation between National Treasury, the Reserve Bank, Cabinet, and relevant stakeholders – not unilateral announcements that pre-empt legitimate policy deliberation.”

Lesetja Kganyago, the governor of the South African Reserve Bank, has been advocating for a lower target for years, claiming that the present target band is too broad and reduces the competitiveness of the continent’s largest economy.