The second is the dynamics of underlying inflation, as a cross-check on how the projections compare with the evolving data. And the third is the judgement as to the strength of  the transmission of monetary policy to date. Let me begin with a review of the drivers of core and headline inflation.
The path of headline and core inflation The sharp increase in headline inflation throughout 2022 stems from both supply and demand factors. On the supply side, overlapping negative shocks from pandemic bottlenecks and the war in Ukraine led to higher costs for firms.