Renormalizing Economic Numbers

Transitioning from 2% to lower levels is challenging due to long-term adaptation, structural influences like international deflation, and the need to establish a new baseline. The fixation on specific percentage points is less relevant than the recognition that sustained wage growth and economic pressures make returning to a long-standing 2% rate improbable. The discussion around recalibrating this baseline is expected to evolve into a contentious political issue, emphasizing the arbitrariness of the 2% target.