CCBG TO DISCUSS IMF’S VIEW ON MONETARY POLICY

MBABANE – For their symposium scheduled for Friday, the SADC Committee of Central Bank Governors (CCBG) will delve deep into the IMF’s view on the challenges relating to monetary policy.

These challenges are brought about by the volatile economic and political situations, which were exacerbated by the COVID-19 pandemic, the political wars in the Middle East and the Russia-Ukraine conflict, among others. According to the Central Bank of Eswatini Governor Dr Phil Mnisi, this was their chosen topic for the symposium.

Symposium

The Governor of the South African Reserve Bank who is also Chair of the SADC CCBG Lesetja Kganyago will be the keynote speaker. The symposium is incorporated in the CCBG’s meeting, which is hosted on a rotational basis among the 16 SADC member States. These meetings provide a platform for the central banks to leverage and engage in any developments that may be consequential to them. Some of these include; sharing of the latest experiences, progress on a three-year study plan that was set on issues such as financial regulation, national payments, currency progress, Central Bank Law, areas of research that the Central Banks may partner to undertake, among many others. The CBE will further host the Alliance for Financial Inclusion (AFI) meeting. AFI is the world’s leading organisation that promotes the agenda for financial inclusion policy and regulation.

Policies

It is a member-owned network from 84 countries which empowers policymakers to develop evidence-based policy solutions that will increase access and usage of quality financial services for the underserved through the formulation, implementation and global advocacy of sustainable and inclusive policies. In its Global Economic Outlook report issued last month, the IMF stated that the global economy remained remarkably resilient, with growth holding steady as inflation returns to target.

It was noted that the journey has been eventful, starting with supply-chain disruptions in the aftermath of the pandemic, a Russian-initiated war on Ukraine that triggered a global energy and food crisis, and a considerable surge in inflation, followed by a globally synchronised monetary policy tightening. Yet, despite many gloomy predictions, the world avoided a recession, the banking system proved largely resilient and major emerging market economies did not suffer sudden stops.

Moreover, the inflation surge-despite its severity and the associated cost of living crisis-did not trigger uncontrolled wage-price spirals. Instead, almost as quickly as global inflation went up, it has been coming down. The international lender noted that markets reacted exuberantly to the prospect of central banks exiting from tight monetary policy. Financial conditions eased, equity valuations soared, capital flows to most emerging market economies excluding China have been buoyant, and some low-income countries and frontier economies regained market access.

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