The fourth point, the rebalancing of global demand, was necessary to counter these sizable headwinds, supporting global growth until the positive effects from the other three kicked in.
In other words, while a tight monetary policy to reduce inflation in a sustainable manner could be accompanied by a serious challenge of potentially increasing unemployment, it may obtain more support from the public compared with the opposite inflationary policy – as it could bring about improvement in real income as long as a decline in inflation moves ahead of a decline in income growth.