This means that we are always looking at demand and supply in the economy and trying to bring them into balance. So, in carrying out our policy, a large part of the analysis we do is concerned with the many factors that can influence demand and supply. The most important factor is, of course, the strength of domestic demand.
It is then likely to come down as the impact of last summer’s floods on food prices continues to unwind; we will see those effects around the end of the year and the early part of next year. After that, the assumed impact of the carbon pricing scheme, which we have now put into the forecasts, starts to affect the headline inflation figures.