Figure 2
The horizontal axis of the two charts is labeled “quarterly” and tick labels including “2000 q 1”, “2005 q 1”, “2010 q 1”, “2015 q 1”, “2020 q 1”, and “2025 q 1”. The vertical axis in the left panel ranges from negative 5 to 5 with visible gridlines, and in the right panel ranges from negative 10 to 15 with similar gridlines. In the left panel, a legend is shown below identifying three lines labeled “phi w 1 t”, “d s underscore u b”, and “d s underscore l b”. The line representing “phi w 1 t” starts slightly above 0 at “2000 q 1”, fluctuates around 0 with small positive and negative movements through “2005 q 1” and “2010 q 1”, dips below negative 1 around 2008, rises again toward 0, and then shows a sharp decline below negative 3 near “2020 q 1” before returning toward 0 and stabilizing slightly below and above the horizontal reference line by “2025 q 1”. The line representing “d s underscore u b” starts near 1 at “2000 q 1”, fluctuates between 0 and 2 through “2005 q 1” and “2015 q 1”, then increases sharply to above 5 just before “2020 q 1”, reaches a peak above 6, and then declines steadily back toward values close to 0 by “2025 q 1”. The line representing “d s underscore l b” starts slightly below 0 at “2000 q 1”, fluctuates between negative 1 and 0 across the early years, drops sharply below negative 5 near “2020 q 1”, reaching the lowest point in the panel, and then rises back toward 0, ending slightly below 0 by “2025 q 1”. Two horizontal reference lines are drawn across the panel, one slightly above 0 and one slightly below 0. In the right panel, a legend below identifies three lines labeled “phi w 2 t”, “d s underscore u b”, and “d s underscore l b”. The line representing “phi w 2 t” starts near 0 at “2000 q 1”, remains close to 0 with small fluctuations through “2005 q 1”, “2010 q 1”, and “2015 q 1”, then rises slightly above 3 near “2020 q 1”, and returns toward 0, ending near 0 by “2025 q 1”. The line representing “d s underscore u b” starts near 1 at “2000 q 1”, fluctuates between 0 and 2 across the early and middle periods, then rises sharply near “2020 q 1” to above 10, reaching a peak around 13, and then declines rapidly back toward 0 by “2025 q 1”. The line representing “d s underscore l b” starts slightly below 0 at “2000 q 1”, remains between negative 1 and 0 through the early years, drops sharply below negative 7 near “2020 q 1”, and then increases back toward 0, ending slightly below 0. Two horizontal reference lines are also present in this panel, one slightly above 0 and one slightly below 0, mirroring the structure of the left panel. Note: All numerical data values are approximated.Time-varying weight of the MCI. Note: the time-varying weights for interest rates and . The and are weights indicating the relative importance of the real interest rate and the exchange rate in determining monetary conditions. Figure created by the authors, data source from FRED (2025) and SARB (2025a, b)