The Governing Council considers that price stability is best maintained by aiming for a two per cent inflation target over the medium term. A two per cent inflation target is consistent with standard definitions of price stability and provides a safety margin to protect the effectiveness of monetary policy in responding to disinflationary shocks and to guard against the risk of deflation.
It states that the availability of finance and opportunities to invest are crucial for the stabilisation of economic outcomes. Let me give you just two examples. The preference of investors for investing in local assets rather than diversifying internationally, known in the economic literature as “home bias”, has not yet disappeared.