Operation of monetary policy

This article covers the period from July to September 1993.

It was judged appropriate to leave official interest rates unchanged during the third quarter, given the evidence on prospects for price inflation and with the recovery in activity continuing and apparently becoming more broadly based. The central projections in the Bank's August Inflation Report envisaged inflation staying within its target range in the first quarter of 1994 - when pre-announced indirect tax increases are due to take effect-although getting closer to the top of the range. No early progress towards the lower half of the target range was projected. In the meantime, the Bank maintained a close watch on indicators of prices, activity and monetary growth, as well as on the exchange rate.

Operation of monetary policy