In fact, banks are likely to have significant direct or indirect presence in the debt market as issuers, investors or underwriters. If the overall environment in the financial sector contains problems in pricing of risks by banks, bond markets too can suffer infirmities in pricing.
To set effective policies in both tranquil and turbulent times, we must understand what drives inflation and be able to anticipate its future movements. So tonight I'd like to talk in some depth about inflation: exactly what it is, how we measure it, and how we gauge the underlying economic pressures that cause it to rise or fall.