1980. the key observation is that during this period, increases in core inflation tended to follow increases in total inflation ( which includes food and energy ). the oil and food price increases “ pulled ” core inflation. in contrast, figure 7 shows the total and core inflation rates since 1986. during this period, inflation has been lower and less volatile. and unlike in the earlier period, core inflation does not follow or gravitate to the level of total inflation. total inflation jumps up and down as food and energy prices live up to their reputation for volatility. the spikes are tough on households, to be sure. but importantly, total inflation eventually gravitates to the core measure that excludes food and energy. core inflation stays “ moored. ” figure 8 represents another way to use the available data to explore this relationship. it too shows that the increases in total inflation in recent years have generally been temporary. for each quarter from 1998 to 2010, the figure plots the difference between total inflation and core inflation at the time, and the total inflation rate two years later. what it shows is that when there is a supply shock such that total inflation ( including food and energy ) exceeds core inflation, two years later total inflation tends to be lower – when supply shocks such as oil prices drive up total inflation relative to core, the total tends to come back down toward the core inflation rate. figure 9 performs similar analysis but focuses on the future core inflation rate, instead of the total. it shows no strong relationship. when total and core inflation diverge, core inflation tends to stay put. in other words, in recent years, when something like an oil shock causes total inflation to diverge from core, there was no consistent implication for the future core inflation rate. the shock to total inflation did not become embedded in core inflation. why is all this important? if supply shocks tend to have a transitory impact on headline inflation, and do not pass through to any meaningful extent into core inflation, then monetary policy need not respond to the price increases caused by the supply shock. currently, we have experienced sharply higher food and energy prices. if the relationship we document over the last 13 years continues, we should expect the impact on inflation to be transitory – and that total inflation will converge back to core inflation, which remains well below 2 percent. to digress, it is likely the case that supply shocks have become transitory because of the way in which monetary policy has tended to respond.

##sidencies. the italian presidency has also promoted the development of a global baseline for disclosing and reporting sustainability information ; it has focused on metrics for classifying and verifying sustainable investment ; and it has called on international financial institutions to align their operations with the aims of the paris agreement. other initiatives to further promote sustainability include : the request to the imf and the international organisations of the interagency group on economic and financial statistics to consider climate - related data needs in preparing a new data gap initiative ; the work carried out by the financial stability board to both address data gaps on climate - related financial risks and enhance disclosures ; the proposal to examine how to scale - up digital finance to promote sustainable growth ; and the analytical review of specific solutions to achieve climate neutrality, including carbon pricing. digitalisation also received ample consideration in our agenda. in july the g20 menu of policy options on digital transformation and productivity recovery was endorsed. it provides an overview of measures to revive productivity growth, with a particular focus on digital platforms, digital skills and intangible assets. this menu will contribute to future discussions within the g20 and will eventually serve as a guide for effective policies and regulations, to ensure that the benefits of digitalisation and innovation are fully exploited and evenly shared. as part of our drive to foster the development of new technologies, in may the bank of italy and the bank for international settlements ( bis ) innovation hub, through its singapore centre, launched a new g20 techsprint, following an analogous initiative last year by the saudi arabian presidency. our international hackathon received about 250 draft proposals and 99 full applications from 25 countries ; 21 teams advanced to the final stage and the 3 most promising solutions for the proposed challenges, which concerned green and sustainable finance, won the competition. these 3 teams are now competing in the global fintech hackcelerator organised by the monetary authority of singapore at this festival. i am recording this message before the announcement of the winners, so i wish them all the best of luck. our attention to the opportunities offered by digitalisation has gone hand in hand with a focus on the challenges that it poses to financial inclusion. the digitalisation of payments and financial services has accelerated sharply during the pandemic. in lower income countries, many citizens can access basic financial services only through online providers. without comprehensive financial awareness and better consumer protection, consumers, not only in less developed countries, may find themselves exposed to risks due to digitalisation. the