So, that constellation of financing conditions should be seen as the reference point for our policy moving forward. By that metric, the steepening in the nominal GDP-weighted yield curve we have been seeing is unwelcome and must be resisted.
Such skeptics have adjusted their expectations due to the rise in actual inflation reflecting the improvement in the output gap. This tendency is likely to become stronger going forward. The rise in inflation expectations, moreover, has the effect of directly raising actual inflation through an additional channel distinct from the boost to aggregate demand through lower expected real interest rates.