The real problem, however, is that by the time you are sure inflation is taking off, it is too late: it takes many months for higher interest rates to dampen inflation.Given this lag, and given the extraordinarily low level of rates today, the Fed's gradualism is surely a gamble.
The strict clock can be superior for trees with shallow roots because of low levels of rate variation between branches.
It said that a "very low level of Bank rate could have counter-productive effects on the operation of some financial markets and on the lending capacity of the banking system".
This is what the seven said: "It was possible that, given the strength of the headwinds faced by the economy, even the current extraordinarily low level of Bank rate was not providing a great deal of stimulus to activity.
The central bank said the "stock of past purchases, together with the low level of bank rate, would continue to impart a substantial monetary stimulus to the economy for some time to come".
The current exceptionally low level of interest rates will need to increase once the recovery is well established.
Investors believe the Fed will keep to its dovish comments about maintaining the current low level of interest rates.
"Housing affordability is at an all-time high, given the current levels of employment and a low level of interest rates," he added.
But he hinted that, despite the low level of interest rates, the Frankfurt institution had more steps it could take to prop up the 17-nation bloc.
Worse still, that has led to ministers and the media making statements about the supposedly low level of sanction rates, which are quite clearly misleading".
