This could reflect not only a greater weight of backward-looking elements in the formation of households' expectations, but also the large weight of the most volatile components of inflation in the consumer basket of less well-off households. Wage dynamics in Italy and in the euro area have so far remained contained.
This is why it is very important for the bank to spot change drivers early, as well as identify those factors that will enable it to mount an agile response to change. Sometimes this change identification and response mechanism may involve big decisions, such as the introduction of service automation or a new banking channel.