Central Banks Must Be Watchful on Inflation, BIS Says

The video discusses the challenges central banks face with inflation, particularly whether it is transitory or persistent, amid rising energy prices. It highlights the volatility of energy prices and their impact on markets, compounded by COVID-19 disruptions. The discussion extends to supply chain issues and the need for market adjustments. The video concludes with insights on monetary policy's role in economic recovery, emphasizing that it should not attempt to counteract supply chain-induced price increases unless inflation dynamics change significantly.

What is the significance of relative price changes in measuring inflation?

What does the speaker suggest about the role of monetary policy in addressing inflation?