While this may be an extreme example, in general it has come to be considered that the efficacy of economic policy cannot be discussed without taking into account its effects on people’s expectations. These recent changes in the thinking on economic policy naturally have a close bearing on the fundamental thinking about central banking and monetary policy management.
BIS Review 142/1996  -6-  For example, even when implementing short-term demand management policy, it is necessary to ensure that the policy is compatible with the objective of price stability -- the medium to long-term objective of monetary policy and a precondition for the smooth functioning of the market mechanism.