South Africa’s new lower inflation target is giving the rand fresh momentum, with policymakers and analysts agreeing it could curb a long-term track record of weakness.

Africa’s largest economy last month formally adopted a 3% inflation target long championed by central bank Governor Lesetja Kganyago, aligning the goal more closely with trading partners. The shift — replacing the 3% to 6% target band in place since the turn of the century — has helped pull 10-year bond yields to 2017 lows and put the rand on track for its strongest year against the dollar since 2009.

“Inflation differentials are very important for long-run exchange rates,” David Fowkes, a member of the central bank’s monetary policy committee, said at a media lunch last month. “This idea that the rand is always weak is basically a policy decision that we made to have a high inflation target.”

Now that it’s been lowered, “I’m sure we’ll get some volatility, I’m sure there’s still going to be shocks, but you just shouldn’t have the same kind of trend depreciation over long periods of time,” Fowkes said.

The new goal is likely to curtail long-term rand depreciation by keeping South Africa’s inflation closer to that of other nations, reducing the need for the currency to weaken to maintain purchasing power parity — the prices of similar goods and services across countries — according to research by RMB Morgan Stanley analysts including Arnav Gupta and David Cueva.

The new goal may also help reduce the real effective exchange rate — the currency’s price-adjusted value — which would benefit the economy, they said.

Over the past 20 years, the rand has weakened about 7% a year against the dollar, with an estimated 12 basis points of pass-through for every 1% move, that slide may have added about 80 basis points to headline inflation, the analysts said.

“Given the currency’s volatility, this further increases the risk premium embedded in rates, pushing markets to price higher front-end yields,” they wrote. “A slower pace of depreciation would help to reduce this risk premium and support lower real rates.”