Supply shocks that take the form of a change in the level, or growth rate, of potential output are often hard to recognize. Here, however, the key is for the central bank to return the trend of inflation to the target if it has moved away.
And as public authorities we exist for the general good of the societies we serve. But as the financial crisis has shown, we should not be myopic when it comes to this issue of prosperity. The prosperity we had created in the years before the financial crisis, had been based on excessive leverage.