00:00I think it's prudent for us to have our policy in a mildly restrictive posture, right?
00:08So that our policy is not contributing to prices going up,
00:11but rather is likely to contribute to the prices and inflation coming down back to our 2% target.
00:17And before the tariffs were coming into place, I felt like we were on a path to 2%.
00:21I felt like we were in a good place.
00:23So once we get through all that, there is a possibility that the post-shock regime will return to that
00:32and then we'll be on that trajectory.
00:34And our policy was contributing to that movement of 2%.
00:37I want to make sure we're still positioned there.
00:39For me, I think the neutral level is maybe 25 to 50 basis points lower than what we are right
00:46now.
00:46So I think we are modestly, mildly restrictive.
00:51We're not super restrictive.
00:53And for me, one measure is just how robust the economy has continued to be.
00:57If we were a super restrictive economy, producing it above potential to a 2.2, 2.5, it's hard to
01:05imagine that.
01:07And so I think what we're seeing is consistent with being mildly restrictive.
01:11We've been at this kind of plateau for probably two years now.
01:15There's been a lot of turbulence in the economy, which can justify that.
01:19But if it starts to move in the opposite direction again, which it hasn't for several years,
01:25that would be super concerning.
01:26And for me, you'd have to have hikes on the table.
01:30And then we just have to look under the hood to see what's driving the increases in those numbers.
01:37Very pure.
01:37Very pure.
01:37Very pure.
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