Monthly figures (not monthly averages of daily data) were judged adequate for the purpose of computing compulsory reserves. The exchange rate and other prices were “fixed” once a day. The reality of the monetary and financial world is becoming that of the intra-day, the micro wave; we are moving towards a continuous-time economy.
However, following the introduction of VAT, and as you will recall, inflation started rising, and increased from 5.9 percent in June 2002 to just over 11 percent by the end of the year. The Bank had anticipated a temporary increase in headline inflation arising from the introduction of VAT, of between 4 percent and 6 percent over and above underlying inflation.