ABSTRACT
Central banks have to act or react in response to actual, perceived or anticipated events. In the ever-changing internationalised economy, the South African monetary authorities have increasingly become exposed to numerous challenges in their efforts to achieve domestic price and financial market stability. When the central bank decides on a route or action to be taken, it sets in motion a series of economic events. The sequence of events starts with the initial influence on the financial markets, which in turn slowly works its way through to changes in current expenditure levels. Monetary policy in South Africa over the past two decades The De Kock Commission of Inquiry into the Monetary System and Monetary Policy in South Africa originally laid the foundation for monetary policy implementation during the 1980s. It was essentially changes in the transmission mechanism of monetary policy that eventually affected the credibility of the money supply as the intermediate guideline of monetary policy.
