V It no doubt owed something to the sense of realism in the thinking of our two nations that a “stability culture” evolved, and was consolidated, in both our countries. And in both countries the respective central bank plays a major role in cementing that stability culture.
If new evidence begins to accumulate that inflation is not declining in line with our forecast, we are prepared to raise our policy rate further. But if new data are broadly in line with our forecast and inflation comes down as predicted, then we won’t need to raise rates further. We expect economic growth to be close to zero for the next three quarters.