We were, admittedly, a little tentative in that judgement, but based on that assessment, the Board elected to leave interest rates unchanged in December. At our most recent meeting two weeks ago, we felt we could be a little more confident in that inflation forecast. We will, of course, see some large movements in CPI inflation in the next few quarters.
Moreover, banks themselves, aided by the expansion of deposit insurance, have competed heavily for such deposits as potentially more stable sources of funds in a crisis environment. Importantly, such newly acquired low-cost “core” deposits may not be as stable or as interest rate insensitive as similar deposits may have been in the past.