The range of possible outcomes is far too wide to incorporate into an economic projection. The four main uncertainties around the outlook for inflation are the same as six months ago, but good progress has been made on some of them.
First, in terms of economic potential, our annual review led us to conclude that the economy currently has more capacity than we previously thought. As well, this capacity is growing at a faster pace than we expected. This means we have a little more room for economic demand to grow before inflationary pressures start to build.