At that time, a discussion of how a central bank’s international responsibilities fit in with its domestic mandate may be warranted. While recognizing the political difficulty of altering any central bank’s mandate, the conference will have to deliberate on how international responsibilities can be woven into existing mandates.
And it could lead people to lower their expectations for future inflation, which in turn could lead to an increasing shortfall of inflation from our objective.1 Indeed, some indicators of longer-run inflation expectations have been on the soft side in recent months.