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Prices may rise even when aggregate demand is not in excess of the supply potential.
Councils have a legal duty to supply potential right-to-buyers and current leaseholders with repair cost estimates.
A related problem is the damage the banking crisis has wrought on the UK's supply potential.
Or the rise in the discount rate could effectively mean a reduction in the economy's supply potential.
There is probably agreement that when overall demand is running in excess of the supply potential of the economy, it should be reduced by monetary and fiscal policies.
There is not the same agreement about the effects when demand is initially running below the supply potential of the economy.
Imbalance may also result when aggregate demand runs above the supply potential of a country, forcing prices up or raising imports.
"A vote to leave the EU could have material economic effects – on the exchange rate, on demand and on the economy's supply potential – that could affect the appropriate setting of monetary policy," Carney told a news conference.
"In particular, near-term fiscal policy should be more supportive where appropriate and provided there is fiscal space, especially through investment that boosts both the demand and the supply potential of the economy".
While the recession no doubt did some damage to the economy's supply potential, there is enough slack to allow a number of years of strong growth before capacity constraints are reached and inflation pressures start to build.
That was the context in which Carney set his warning last month that "a vote to leave the EU could have material economic effects – on the exchange rate, on demand and on the economy's supply potential".
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com