Monetary Policy Report – July 2024

During the second quarter, headline inflation remained stable, while core inflation (the measure of inflation that excludes temporary movements in the prices of food and regulated items) continued to decline. The aggregate effects of monetary policy, together with low exchange rate pressures, would contribute towards maintaining inflation’s downward trajectory, moving it closer to the 3.0% target by yearend 2025. Economic activity levels would continue to recover for the remainder of 2024 and moving into 2025. As long as inflation and its expectations continue to distinctly converge towards the 3% target, monetary policy can assume a less restrictive stance and contribute further towards the recovery of economic activity.