Recent research by the Bank for International Settlements, for example, suggests that the greater contestability of labour markets via the proliferation of global value chains puts a lid on wages.1 More research is needed here, however, to determine which factors are the most prevalent, and whether they are temporary or secular in nature. 3.
They must conduct monetary policy within a framework that convinces price setters that they will act in the future as necessary to maintain price stability. In principle, central banks could offer an exhaustive list of how they would respond to any future eventuality. But in practice, it is impossible to foresee all future contingencies.