Breaking down the nominal term premium into its components, the real term premium and the inflation risk premium, is subject to data limitations as estimates are based on inflation-linked bonds or swaps which have only recently become more widespread.
If the cash rate target was lowered, the traded cash rate would decline to that lower rate and policy had clearly moved to a more expansionary footing. The mechanics of the first stage of monetary transmission was also well understood. [1] The cash rate anchored very short term interest rates.