for consumer price index ( cpi ) inflation from the survey of professional forecasters ticked up in february, this measure remained at essentially the same value that has prevailed since 1998. as for inflation compensation derived from spreads between yields on nominal and inflationindexed treasury securities ( known as treasury inflation - protected securities, or tips ), the implied rate of inflation compensation from five years ahead to ten years ahead ( the socalled five - to - ten - year - forward rate ) has risen somewhat since the beginning of the year. does this rise in forward inflation compensation indicate that long - run inflation expectations have risen by a similar amount? my best guess is that much of the rise in inflation compensation reflects other factors. to begin, recall that inflation compensation measured by using tips yields is not the same thing as inflation expectations. rather, movements in inflation compensation reflect not only changes in inflation expectations, but also changes in an inflation risk premium and in the relative liquidity of tips and similar maturity nominal treasuries. 3 to see that these components are distinct, recall that during the period of heightened concerns about deflation in 2003 and 2004, forward inflation compensation rose substantially to an unusually high level amid concerns about an unwelcome fall in inflation ; that earlier episode, in particular, underscores the fact that we must be careful in using the forward rates of inflation compensation as a gauge of long - run inflation expectations. to see this distinction another way, consider a scenario in which inflation uncertainty increased but inflation expectations for additional background, see gurkaynak, sack, and wright ( 2008 ). they discuss the decomposition of inflation compensation into these distinct components and argue that far - forward rates of inflation compensation are too volatile to be pure measures of long - run inflation expectations. did not. in that case, the midpoint of inflation expectations would remain the same, but the range around the midpoint would increase. turning specifically to the recent experience, consider the sequence of one - year - forward rates of inflation compensation – that is, decompose ten - year inflation compensation into a sequence of one - year - forward rates. the one - year - forward rate ending about five years from now has moved up, but the forward rate ending in ten years has climbed more than twice as much. this pattern suggests an important role for factors other than rising long - run inflation expectations in explaining recent movements in inflation compensation as one might suppose that any tendency toward higher inflation would be expected to show through within five

is increasing, year - on - year growth in bank credit to both the household and non - financial corporate sectors remains negative. against this background, the countercyclical capital buffer ( ccyb ) rate on banks ’ irish exposures is maintained at zero per cent. the countercyclical capital buffer ( ccyb ) is a time varying capital requirement which applies to inscope banks and investment firms. it is designed to make the banking system more resilient and less pro - cyclical. essentially the ccyb will increase the capital requirement of banks if we see credit growth becoming “ excessive ". it can then be released, partially or fully, either in the case of a period of systemic stress or when credit growth and associated systemic risks recede. the review shows that credit growth to smes remains negative across all sub - sectors as firms continue to deleverage. new lending to smes, however, has been rising since early 2014. a large decline in npl rates across all categories of sme / corporate loans has been evident in recent years, although more than 10 per cent of loans are non - performing and substantial sectoral variation in npl rates arises. 1 / 3 bis central bankers'speeches some categories of household credit are showing positive growth, including non - mortgage credit and mortgage lending at fixed rates. the overall rate of growth in mortgage loans remains negative as floating interest rate mortgage lending continues to fall. while household debt has been declining, the sector remains highly indebted, at €143. 8 billion in 2016q4, leaving it vulnerable to a rise in interest rates. those in the 30 – 44 age category have high debt - to - income ratios relative to other age cohorts and by international comparison. the overall number of mortgage arrears cases has declined by 44 per cent since 2013q2. almost half of mortgage arrears cases are in very long term arrears. turning now to the irish commercial real estate ( cre ) market, 2016 continued to see high total returns. the commercial property vacancy rate was 13. 5 per cent in 2016q4. it is much lower for the dublin office sector, at 7 per cent in 2017q1. a substantial amount of new office supply is under construction, being planned, or at pre - planning stage. the commercial real estate market has also seen a broadening of its investor base in recent years. the possibility of firms seeking to relocate to ireland as a