Short-term inflation fluctuations around the central bank’s target, for instance, those observed in Russia in 2017, 2018, and 2019, with inflation expectations being relatively stable and even lowering, do not contradict price stability. Conversely, high inflation expectations that might entail a longer-lasting deviation of inflation upwards from the target involve significant risks to it. These are the risks of a decline in the purchasing power of incomes and savings, which is especially sensitive for the most economically vulnerable groups of the population. Monetary policy should mitigate such risks. Therefore, already in March 2021, as the economy bounced back to its pre-pandemic level, the Bank of Russia started to raise the key rate from its record-low of 4.25% to 6.5% p.a. following the July meeting of the Board of Directors. The Bank of Russia will make decisions on its further moves depending on the path of economic development and the trends of inflation and inflation expectations. Baseline scenario I would like to remind you that the Bank of Russia updates its medium-term baseline forecast four times a year in the course of the Board of Directors’ core meetings on the key rate. The forecast presented in the draft Guidelines was released earlier following the meeting held on 23 July 2021, but this draft extends the forecast horizon to 2024.
Page 7  Towards an international effort – central banks, industry and public authorities rowing in unison In a highly connected and networked industry such as payments, we can only make a real difference if we work together in a coordinated way. We need to row together in unison to reach our destination of faster, cheaper, more transparent and more inclusive cross-border payment services. So what are the concrete actions that each of the groups – central banks, industry and public authorities - need to take? The role of central banks Central banks, both as operators and supervisors, of payment infrastructure, we have a key role to play. We build infrastructure, add new functionality and set standards and policies to underpin safe and efficient economic and social activity. Central banks need to start changing policies and enhancing core payment systems in line with the best practices, assessments and analysis that are developed as part of the work on the 19 building blocks. To do so effectively, we need to listen to and collaborate with industry, involving them in outreach and consultations and updating them on latest developments. And we also need to share our learnings and experiences with our peers, and beyond. This could be done through the establishment of communities of practice, through which central banks can discuss challenges and barriers with peers and find ways to overcome them. The role of industry The payments industry is another key, and wide range group including correspondent banks, FMIs and the non-bank FinTech.