What can affect our objective, however, is if those forces have a persistent impact on inflation – which is to say, if they become embedded in inflation dynamics and inflation expectations. But that is not a structural issue; it is about the credibility of monetary policy in anchoring inflation expectations. This brings me to the second line of argument against active monetary policy.
1  Most empirical results that find ageing is disinflationary have focused on Japan, as its transition from aging society to aged society is one of the fastest (see, for example, Jong-Won Yoon, Jinill Kim & Jungjin Lee, 2014. “Impact of Demographic Changes on Inflation and the Macroeconomy”, IMF Working Papers 14/210, International Monetary Fund).