An independent central bank acts as an important check on government-controlled fiscal policy, South African Reserve Bank Deputy Governor Kuben Naidoo said on Tuesday.
Earlier this year the governing African National Congress (ANC) party was caught up in a public row over the role of the central bank, with some ANC officials calling for the bank to do more to stimulate economic growth and job creation.
“The central bank places a check on that (government being in charge of fiscal policy). It places a constraint and limitation. In countries without independent central banks it is often tempting for that limitation or constraint to break down,” Naidoo said at a public lecture.
“In the South African context we do feel an independent bank is an important check in the equation.”