The introduction of carbon pricing itself will have a transitory effect on inflation—indeed, such an effect is evident in the most recent monthly CPI figures. But since this effect is due to a one-off structural change, we look through it in making monetary policy—just as we have looked through the transitory effect of lower oil prices in the past couple of years.
The synergies of key technologies markedly elevated prospective rates of return on high-tech investments, led to a surge in business capital spending, and significantly increased the growth rate of structural productivity.