So those comfortable with a horizon of just over a year shouldn’t have too much trouble accepting a two-year forecast. That said, the confidence interval for this set of forecasts is still fairly wide. Graph 1  Third, extreme movements are rarely well-forecast. Late in 2000, Consensus forecasts for US GDP growth in 2001 were about 3½ per cent.
While our view is that the current stance of monetary policy remains appropriate, I can assure you that the Governing Council remains vigilant and will closely watch developments in coming months. Exchange rate developments I would now like to say a few words about exchange rate developments, which, of course, the Governing Council takes into account as part of the overall economic analysis.