A leading bank depended heavily on the central bank's monthly inflation report for various aspects of business planning. The in-house economic team provided a directional statement on whether inflation was expected to increase, decrease, or remain stable. This directional statement preceded the official government numbers by a week. The forecasted direction and lack of information on the expected quantum of change was something that suited the bank in the economic scenario when inflation was stable. Recently, however, the inflation rate has been fluctuating a lot and the bank was keen to have high-quality forecasts of the inflation rate as soon as possible.
The bank had a leading presence in the wholesale and retail market in the country. Some of the management was of the opinion that it would be prudent to assume that their customer...
