In conducting monetary policy, it is necessary to anticipate how these developments will affect future economic activity and prices.
For example, in the current  4  BIS Review 4/2008  context, monetary policy judgments should be made based on the careful analysis of the following issues, which will be incorporated in the future assessment of the economy and prices: (1) whether the slowdown is temporary and the economy can be expected to return to its growth path, or whether there is a possibility that it will last longer than expected; (2) whether price rises could exert a negative influence on the economy, leading to future downward deviations in the economy and prices; and (3) whether, on the contrary, price rises could push up future prices through their influence on households' inflation expectations or firms' price-setting behavior.