With these guiding principles in mind, it should be possible to create a statistical risk toolbox which can help inform the decision makers of an institution. A comprehensive stress-testing programme7 Now let me turn to the second pillar of the risk analysis toolbox – namely a comprehensive stress-testing programme.
And we need persistence because the pick-up in inflation is the result of the prevailing monetary policy stance. If the flow of incoming data were to confirm the expectation of a gradual build-up of inflationary pressures, this would not necessarily be sufficient to affirm a sustained adjustment as less supportive monetary policy conditions could imperil the inflation trajectory.