The reserves accumulation strategy continued to be implemented in close consultation with the National Treasury. During the 2011/12 financial year, the Reserve Bank purchased approximately $ billion for reserve accumulation purposes. These purchases were swapped into the forward market by means of FX swaps in order to sterilise rand liquidity injected into the money market.
Against this backdrop, it may be somewhat surprising that wage growth has so far not been stronger in Germany. The increasing scarcity of labour would normally suggest that wage growth should be stronger. Obviously, countervailing factors are at play here. One of the main factors dampening wage growth is net immigration of labour from other EU countries.