Rather, it represents the iterative conduct of the forecasting exercise between the Monetary Policy Committee and the bank’s staff, and, ultimately, the subjective assessment of the Monetary Policy Committee regarding medium-term inflationary pressures. Evidently, this assessment can change between two publicly released inflation reports if significant new information becomes available.
Higher interest rates over recent times would have meant we undershot our inflation and employment goals, have significant weaker activity, and a rising domestic exchange rate – until it was unsustainable. But there are natural limitations to what central banks can achieve with their tools, and if operating alone.