Understanding post-pandemic inflation: Insights from South Africa and Türkiye

Last month, UN DESA’s Economic Analysis and Policy Division hosted the fourth session of its Development Policy Seminar Series on the World Economic Situation and Prospects. The Seminar examined inflation dynamics in the post-pandemic era in South Africa and Türkiye with a view to discussing lessons learned from these episodes.

Varying central bank responses

The seminar highlighted how two emerging economies responded to inflationary pressures after COVID-19. Monisha Monar (South African Reserve Bank) explained that South Africa maintained its inflation targeting framework throughout the post-pandemic period, prioritizing credibility and transparency. The South African Reserve Bank gradually raised interest rates to anchor inflation expectations and preserve financial stability, despite weak economic growth and high unemployment.

Hakan Kara (Bilkent University) outlined Türkiye’s distinct approach, which included periods of interest rate reductions even as inflationary pressures persisted. He explained how domestic priorities and external vulnerabilities shaped monetary policy decisions, influencing exchange rate developments and macroeconomic stabilization efforts.

Managing complex trade-offs

Both speakers emphasized the challenges of addressing inflation amid external shocks and domestic vulnerabilities. South Africa’s structural constraints—including energy supply disruptions and low investment levels—have complicated inflation management. Türkiye’s high import dependence and external financing needs have heightened sensitivity to global financial conditions and exchange rate movements. These cases demonstrated how country-specific contexts shape the effectiveness of different policy approaches.

Looking ahead

The seminar underscored the importance of central bank independence, policy coherence, and clear communication in managing inflation expectations. The experiences of South Africa and Türkiye illustrate how macroeconomic structures and external conditions influence policy outcomes in emerging economies.