The horizon for net purchases under the PEPP was extended to at least the end of March 2022, and the horizon for the reinvestment of principal payments from maturing securities is set to continue until at least the end of 2023.
For other economies, such as South Africa, the flow of capital may ease the adjustment process by enabling a faster consolidation away from unsustainable fiscal positions. But they also can result in Dutch Disease effects, particularly as in South Africa, where shocks affecting one sector are transmitted to others via input pricing and sector-level collective bargaining. The trade channel works in the opposite direction.