It is not constrained by equations, systems of equations or mechanisms based on a simplified representation of reality. The ECB’s Governing Council reserves the right to include any piece of information, statistic or analysis that it considers relevant. This desire for comprehensiveness in our economic analysis is common with that of the US Federal Reserve.
Even so, it will be some time before we are at what could be considered full employment in Australia and before underlying inflation is at the mid-point of the medium-term target range. This means that stimulatory monetary policy continues to be appropriate.