It involved the Government introducing the new Central Banking Act (CBA) 2000, the Banks and Financial Institutions Act (BFIA) 2000, and the Superannuation and Life Insurance Acts. Under the Central Banking Act 2000, the Central Bank has three important objectives and functions, which are the responsibility for monetary policy formulation and implementation, financial system supervision and oversight of the payments system.
The Act also made significant changes to the relationship between the Central Bank and Government, eliminating political influence, introducing price stability as the objective of monetary policy, and provided greater independence to the Central Bank in the management and conduct of it’s affairs. The Central Banking Act 2000 made price stability as the main objective of monetary policy.