BIS Review 65/1008  3  From a technical monetary policy perspective, although nominal interest rates have been increased significantly, real rates have not, and in fact may have fallen depending on the deflator used. Interest rates, in other words, have not increased by more than the increase in inflation. Does this mean that we have not been aggressive enough as some would argue?
As noted earlier, we have to some extent allowed for first-round effects to happen, and therefore it may have been inappropriate to have responded to those developments, but rather pre-emptively focus on the second-round effects. 5. Changing the target?