Conclusion Capital mobility can complicate the conduct of monetary policy. In Australia, we have found that the complications which arise under a floating exchange rate – while often not trivial – are not of the same order of magnitude as the monetary control problems we had when capital was less mobile but financial prices were heavily regulated.
In the system we have had for some years now, the inflation  BIS Review 86/2006  5  target, rather than the exchange rate, is our anchor for policy.