Specifically, for 13 months in a row, inflation has remained below the permanent 3 percent target. This is quite an achievement, as convergence to this objective assumes inflation to fluctuate  5  See SHCP (2016). “Documento Relativo al Cumplimiento de las Disposiciones Contenidas en el Artículo 42, Fracción I, de la Ley Federal de Presupuesto y Responsabilidad Hacendaria,” April.
Indeed, one of the major insights over the past three decades of monetary policy practice has been that targeting employment can create an incentive for surprise inflation, which in turn leads to higher unemployment. The best contribution monetary policy can make to sustainable job creation is low, stable and predictable inflation.