Owww, I get it. Thank goodness!

Ha, it’s not that bad! Check out the inflation projections in back of the BoE’s Inflation Report. The red fan chart looks like a river of blood.

I don’t understand? I like any knowledge of references to the Motherland.

Well, the BoE did pioneer the Rivers of Blood, and that must count for something!

Goodness me! You have more confidence in this than I do 😀

Perhaps a series of posts discussing it would be fun?

So the RBNZ and RBA are just straight up better 🙂

BoE under King was very keen on discretion and isn’t nearly as transparent as the RBNZ. For example, they’ve talked a lot about ‘slack’ but refuse to publish their estimates of the output gap. We’ll see if things change under Carney…

Tis true – have they been clear that they “will look through external shocks to prices”. The RBNZ over here states that, and then tries to show core and sectoral factor models that help to account for such things.

Or do they view such things as missing the point, or do they put more value again on discretion?

I think you’re exactly right, it’s about keeping the Bank’s forecast below 2.5%. It doesn’t matter that it isn’t clear because it’s not meant to be part of the main message to the public: it’s there to placate the inflation hawks who are worried that the Bank is trying to squirm out of the inflation target. The whole ‘GDP growth’ thing is probably just to give the Bank wiggle room if there are external price shocks so I don’t think the meaning in terms of an economic model is of huge importance. Let’s also bear in mind that this is a speech to the press, not a lecture to an academic audience!