Bank of England policymaker Ian McCafferty on Friday said strict adherence to the inflation target will damage short-term output.
In the new mandate Chancellor in March clarified that the Monetary Policy Committee can use its discretion to allow inflation to depart temporarily from the target, in order to provide a more stable path for output.
"This has been referred to as flexible inflation targeting," McCafferty said in a speech. The remit has not specified how quickly inflation should be returned to the target when unexpected shocks have taken it off course.
There are doubts that the MPC has become more tolerant of inflation. "This is certainly not the case," he said.
"In this environment, I believe it is important to continue to be mindful of the need to keep expectations well-anchored when setting policy," he added.
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