This means that even when the observed inflation rate is affected by economic conditions, inflation expectations do not deviate substantially from, and are thus anchored to, the central bank’s target inflation rate.
Taking into account the economic and price developments across countries, at present – in the United States and Europe – the top priority is to continue to provide or to further strengthen the stimulus to the real economy. While this sounds like an orthodox challenge, from the standpoint of central banks, it presents difficulties in terms of steering their policy.