While higher productivity has helped to keep labor cost increases in check, it cannot be expected to do so indefinitely in ever tighter labor markets. Despite brisk demand and improved productivity growth, corporate profits have sagged over recent quarters.
The 2 percent price stability target  In January 2013, the Bank released a joint statement with the government and introduced a price stability target of 2 percent in terms of the year-on-year inflation rate of the CPI, making a clear commitment to achieving this target at the earliest possible time.