Past experience has shown that the response of the  BIS Review 62/2010  3  rand to lowering or raising interest rates is unpredictable, and it has previously responded by both appreciating and depreciating for varying periods of time. However, the recent rand strength has resulted in an improved inflation outlook, which in turn gave room for a further rate reduction.
While we do not target the exchange rate, we would want to see the rand at a stable and competitive level. Unfortunately, we have seen that achieving this is not straightforward. The global outlook In assessing the future direction of monetary policy, it is important to have a view of the global and domestic outlook.