To achieve that, people have to believe we will do what is required to control inflation over time. The final argument I want to tackle is that the inflation target is too low.
This view accepts that inflation has increased, and that it is not just a few factors that are responsible, but argues that 3-4 per cent inflation is acceptable, and that it is unrealistic to expect to return to the 2-3 per cent standard. I do not think that the 2-3 per cent average inflation target is too ambitious.