We recently also participated in a Financial System Stability Assessment undertaken by the IMF and the World Bank. The report on South Africa has not been published, but found that the South African financial system is robust and that the financial sector’s legal framework is impressive.
Nominal rigidities in price and wage setting also imply that monetary policy, and nominal demand fluctuations in general, have an impact on economic activity. Knowledge about price and wage setting is therefore fundamental to understand both the monetary policy transmission process and the potential trade-offs monetary policy may be faced with.