Stals defends closed-shop policy
In an interview on Friday, he also indicated that interest rates would be reduced only "once credit expansion is firmly under control".
Stals's handling of monetary policy has come under fire from sectors of the business community, who are calling for an easing in interest rates to stimulate growth.
But the demands on the Bank have not stopped there. Increasingly political parties, backed by the trade unions, are suggesting that the formulation of monetary policy should not be the exclusive domain of Stals and his deputy governors.
In a strategy document to be tabled at its biannual conference in December, the ANC proposes: "Monetary policy will be guided as much by the imperatives of the country's economic growth and development as by the dynamics of the market."
However, Stals warned of the impact of loosening controls on monetary policy. "I welcome the debate on the role of the Reserve Bank, but no country in the world, with the recent exception of UK, allows outsiders to determine monetary policy."
The move by the UK government would "create problems" for the Bank of England in a few months time, he says.
Stals warned that involvement by outsiders in the determination of monetary policy would inevitably lead to conflicts of interest. He pointed out that the Bank already had a committee to develop monetary policy, comprising the governor and his three deputies, which met once a month. "We have been mandated by the government-appointed board of directors of the Bank to determine monetary policy. This has worked well and is a clearly defined decision making process.
"If we had to open up the committee, it should include perhaps only members of the Bank's board of directors and even then, there could be a conflict of interest.
"We would then have to restructure and model ourselves on the German Bundesbank, whose board meets once a month to determine policy."
Turning to the calls for an easing in interest rates, Stals said he would be assessing the next batch of figures on credit extension, money supply and inflation before making a decision.
Stals was not concerned about the recent weakness of the rand, citing the general volatility of emerging markets and the strength of the dollar as the main reasons for the fall.
"We are also in a strong position to weather the slide in view of our balance of payments position and healthy level of foreign exchange reserves."
His approach has angered many private-sector economists. The Board of Executors' Rob Lee said recently that the main obstacle to a higher growth rate "is now an unjustifiably restrictive monetary policy. Bank rate should have already been cut, and further delay seems inexcusable."