We have provided more detail about how we see the economy unfolding, what forces might affect inflation, and what assumptions we have had to make about more volatile or uncertain variables. This, in turn, helps to explain the reasons behind our most recent decisions and provides some insight into possible future actions.
The base-case projection embeds changes in the policy interest rate that would be necessary to achieve our 2 per cent inflation target over the medium term. We describe the direction and magnitude of that interest rate path in a few words, in Chapter 4 of the Monetary Policy Report and when we update the base-case projection in the Update.