Given that monetary policy takes time to transmit to the real economy, the full effects of these measures on macroeconomic conditions have yet to fully materialise. However, the adjustment in financing conditions, via which monetary policy transmission operates, provides encouraging signals.
When it comes to divergent policy objectives as inflation was on the upside, financial stability on the downside and the real economy on the side line, letting just one policy tool – the interest rate – do the whole job clearly falls short.