CPI + 5.2%

[greengiraffe]

very logical thinking. Hence foreign $ inflow is stoking asset inflation and locals with huge savings are made to work harder and assume more risks to generate better returns than artificially depressed bank interest rates.

definitely goes against textbook economic theories.

to make the exchange rate centered monetary policies to work perfectly, I think, one condition is that the trade should be well balanced, that is, money will come in and money will go out. If aggregated money flow towards one direction for a persistent long period, the balance will be completely broken, which can easily cause catastrophic disaster. that means, if previously money is flowing in and you counter by appreciating the currency, it will cause more money coming in(Is now a perfect example of this?). and if previously money is flowing out and you counter by depreciating the currency, it will cause further money outflow(I think 1997 AFC is a good example).

not advance economy trained, my own speculation only. please correct me if i am wrong.