That is why we are following closely a wider-than-usual range of indicators that could tell us what is happening on the supply side and give us early-warning signs of pressure on capacity and prices. For example, we watch for unexpected movements in the underlying trend of inflation and for changes in expectations of future inflation.
We also look at commodity prices, wage settlements, reports of shortages in product and labour markets, the growth of money and credit, and information from the Bank’s business contacts across Canada. Take, for instance, our best estimate of the trend of inflation - what we call core inflation.