Year-over-year and three-month rates of core inflation will both need to come down more than they have for inflation to return sustainably to 2%, as will short-term inflation expectations. I spent some time earlier on the global backdrop, so let me tell you what we talked about on that front.
Banking stability may not be an issue of immediate concern because deterioration in asset quality is not expected to appear quickly and we can perceive them as second order impact. According to the IMF, a severe pandemic may also lead to a significant but temporary reduction in net capital flows to emerging markets.