How Can a Central Bank Know When a Transition Is Happening?

How can a central bank know when the transition is happening? How do you detect that when in time? This is really a big challenge. There is no single reliable indicator. The most reliable sign is he signs that wages are chasing prices and vice versa, so called second round effects. But by the time the signs emerge, you may already be too far along the transition. So central banks have no option but to base their decisions on a full array of information which is available to them.