Talking Trends: inflation moving back to target

In June, seasonally adjusted monthly growth of consumer prices decelerated and was close to the target for inflation in annual terms. Businesses and households reported a decline in inflation expectations, with business costs decelerating. However, price movements still diverge across segments, and the anchoring of inflation at the target level has yet to be confirmed. For inflation to steadily decline to 4% and stabilise at this level, tight monetary conditions will need to be maintained for a sustained period.