The shift in relative prices is a shift in global prices that is more or less invariant to the level of the Australian dollar. In other words, while the global shift in relative prices is income-enhancing for Australians overall, it is also structural change-inducing.
In these circumstances, it is important for the Reserve Bank not to overreact to exchange rate weakness. Too quick a tightening of monetary policy could endanger the growth prospects of South Africa and encourage an outflow of capital. This would put greater and more lasting pressure on the exchange rate of the rand with important consequences for inflation.