First, we are looking at varying and uneven pace of recovery across the globe. Given global interdependencies and linkages, it could lead to slower growth over the medium term. BIS Review 96/2010  1  Second, the potential heavy influx of capital inflows, as risk appetites perk up, can also complicate monetary management.
Additionally, the rebound of the global economy could create upward pressures on commodity prices and fan inflation. There could be positive surprises to investor confidence, which could foster a stronger-than-expected improvement in market sentiment and prompt a strong rebound in investment and demand. Third, there are risks to the inflation outlook.