These effects, together with a gradual rise in medium- to long-term inflation expectations, are likely to be reflected in long-term interest rates, which would eventually stabilize at levels consistent with the 2 percent price stability target.
Moreover, the Bank continues to closely monitor market developments within a flexible operational framework and through discussions with market participants, and it expects that both short- and longterm interest rates will move largely on a stable path. E.  Why are inflation expectations so important?