national institute of economic research ’ s business tendency survey. 7 according to this measure, inflation expectations have followed actual inflation fairly well. in other words, the agents have not been “ tricked ”, but have realised that inflation can deviate from the target in the short run. if wage increases are based on this measure, then in other words real wages have not been too high and unemployment has thus not been “ unnecessarily high ”. before i move on to the next type of criticism, i would like to emphasise that what i have said here should not be interpreted to mean that i wish to make light of inflation undershooting the target. the riksbank should of course do its best to attain the inflation target and i can assure you that we do. however, it is not an easy task, and i believe that many people understand this. proposal for higher inflation target and target for employment another type of criticism is aimed at the target formulated for monetary policy. it comes in slightly different forms, but a common theme is that the inflation target should be raised, and that it should be combined with an explicit target for employment or unemployment. one concrete proposal that is put forward is that monetary policy should support a target for an employment rate of 80 per cent. 8 the level of central banks ’ inflation targets has begun to be discussed internationally as a result of the recent crisis. 9 one argument is that if the targets were set slightly higher, it would make it easier to stimulate economies in deep recession, as it would reduce the risk of the policy rate reaching the zero lower bound. this is a relevant argument. moreover, it is probably not the case that an inflation rate of, say, 3 per cent would be more problematic to live with than an average inflation of 2 per cent. it is only at considerably higher figures that inflation is harmful. difficult to change an established inflation target however, it is one thing to set an inflation target for the first time, and a quite different thing to raise an existing target. if we go back twenty years in time, to when the policy of inflation targeting was introduced, the target could in principle have been set at 3 instead of 2 per cent. it is possible that it would have been a little more difficult to make the target credible, partly because it should have been higher than actual inflation at the time – which was fairly exactly 2 per cent, and partly because the few central banks that had begun targeting inflation at that time had chosen

fatih karahan : recent economic and financial developments in turkey speech by ms fatih karahan, governor of the central bank of the republic of turkey, at the briefing on the inflation report 2024 - ii, ankara, 9 may 2024. * * * distinguished members of the press, esteemed participants, welcome to the briefing to convey the main messages from the second inflation report for 2024. i would like to extend my respect and greetings to all of you. as we have always underlined, the cbrt's primary objective is to achieve and maintain price stability. to this end, we have been implementing strong monetary tightening since june 2023. we closely monitor price setting behavior and inflation expectations. we are determined to maintain our tight monetary policy stance until inflation falls to levels consistent with our target. i would like to emphasize again at the beginning of my speech that we will definitely not allow a permanent deterioration in the inflation outlook. i will start the meeting with a presentation on our assessment of the global and domestic macroeconomic outlook and our monetary policy stance, as well as our inflation forecasts. later on, i will address your questions. before i begin my assessments, i would like to draw your attention to the box studies we have included in our inflation report regarding the prominent issues on the agenda. the boxes in the report cover different topics such as services inflation, expectations and tl deposits. i would like to make a special note here for those who are interested. distinguished guests, i will first touch upon recent key developments in the global economy. global financial conditions continue to weigh on growth. geopolitical developments and the ongoing tight monetary policies stand out as risk factors for the course of global economic activity. meanwhile, both the export - weighted global growth outlook and leading indicators point to a limited improvement in global economic activity, compared to the previous reporting period, mostly driven by the services sector. the recent growth outlook for the us economy has diverged favorably from that of the euro area and other advanced economies, and economic activity in the us has been relatively robust. 1 / 12 bis - central bankers'speeches commodity prices continue to be driven by the outlook and composition of global growth, geopolitical risks, financial conditions, and supply - side factors. commodity prices have posted broad - based increases since the previous reporting period. in addition to supply - side factors, some industrial commodities have recorded notable price increases, particularly in line with china's growth. with the heightened geopol