With that horizon in mind, we need to look through any short-term volatility—and there's been a lot of short-term volatility in recent months. Mostly, we do that by focusing on our measure of core inflation, which excludes the eight most volatile components of the CPI, as well as the effect of changes in indirect taxes on the remaining components.
Of course, any measure of core or underlying inflation won't perfectly predict future inflation. We also look carefully at what is happening to individual CPI components, to gauge the size and persistence of any price changes. So, for example, recently we have spent a lot of time examining the factors driving the prices of electricity, insurance, and some foods.