I want to drill down on these latter two elements: measures of core, or underlying, inflation and measures of inflation expectations. These are critical guideposts for us as we seek to bring total CPI inflation all the way back to the 2% target. Core inflation As we look for a more fundamental turning point in inflation, measures of core inflation are becoming increasingly relevant.
Indeed, just as a warm winter allows insects and disease to survive into spring, the prolonged period of stability itself had lulled many into a sense of false security, creating an environment that provided no warnings to those with growing risk appetite.