A persistent breach of the South African Reserve Bank's inflation target will require a policy response even as the country's economic growth outlook weakens, the central bank's deputy governor Daniel Mminele said.
"The SARB will tolerate temporary breaches of the inflation target in the interest of smoothing out short-term fluctuations in economic growth," Mminele said in a speech in Washington on Saturday.
"However, a persistent breach of the inflation target range will require a policy response to achieve sufficiently low inflation," he said.
The monetary policy committee has increased the benchmark rate four times since July to 7%, even as it cut its economic growth forecast for the year to 0.8%, the slowest rate of growth since 2009.
Inflation accelerated to 7% in February and the central bank forecasts it will return to its 3% to 6% target band only in the final quarter of 2017.
