2  BIS central bankers’ speeches  Yet, policy makers need more than just good inflation forecasts: we also need to understand the inflation process in order to better assess the role of monetary policy. We must also be able to explain our reasoning to the public, as the management of inflation expectations has become an important monetary policy channel.
With respect to oil prices, too, there is still the possibility of further increases. In addition, the vigorous expansion of money and credit aggregates in an environment of already ample liquidity is clearly amplifying these existing upside risks to price stability.