What does "gradual" mean? This is one of the key pre-occupations of forecasters right now, given central banks are emphatically emphasising that any normalisation of policy will be gradual.
And yet the meaning seems to differ wildly. For the US Federal Reserve gradual appears to signify 0.25 percentage points of tightening per quarter. According to the dot plot – the Federal Open Market Committees expected path of future rates – this gradual expansion will see them bringing rates back to what it considers normal within about two years.
Bank of England governor Mark Carney – after hiking interest rates by 0.25 percentage points – also was at pains to stress that any future tightening will be gradual. But for the Bank of England gradual means 0.25 percentage points basis points per year, not per quarter.
Read more: Bank of England raises interest rates with unanimous vote
The Bank also produced an estimate for the first time of what it perceives normal interest rates to be (so-called R-star in economist speak – technically defined as the level of interest rates appropriate to meet the two per cent target when the economy is not subject to cyclical fluctuations). R-star is expected to be between two per cent and three per cent in nominal terms.
So in contrast to the Federal Reserve, the Banks gradual normalisation will still leave interest rates well below "normal" in two years time.
Perhaps Carney should have emphasised the word glacial rather than gradual.
Of course, the governor has to contend with the uncertainty of Brexit and a moderate fiscal headwind which is quite different to the fiscal backdrop that faces the Federal Reserve under US President Donald Trump.
Read more: The Bank of England has an excuse for unreliable boyfriend syndrome
But both central banks are charged with making sure their economies operate at an appropriate level of capacity, one which is consistent with low and stable inflation. If the unemployment rate is the best gauge of capacity, then the US and UK dont look too different. Both economies have an unemployment rate which is at a four-decade low, at least, and there are signs that wage growth is picking up moderately.
If both economies are broadly at full employment then the outlook for where interest rates should be in two to three years time boils down almost entirely to a judgment on Brexit, since by then fiscal policy is likely to be fairly neutral in both economies.
If – like me – you believe the economic realities will drive both the UK and EU negotiators towards a relatively soft Brexit deal then this headwind may also have diminished going in to next year. In which case, the market might question whether "gradual" is something slightly more akin to thinking at the Federal Reserve, rather than that delivered today.
Read more: Bank of England: Economists split as policymakers face the unknown
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