In February 2000 the government announced that South Africa had formally adopted an inflationtargeting monetary policy framework to make monetary policy more transparent and accountable and to promote a more co-ordinated approach with other policy measures.
In the application of inflation targeting in South Africa, it was decided to leave the external value of the rand to the market and not to intervene in the foreign-exchange market to influence the exchange rate. It was realised that this could lead to volatility in the exchange rate of the rand.