Surveys suggested that a large share of households did not plan to make major purchases over the next 12 months (left chart, slide 3). Their savings intentions remained at historically high levels as uncertainty continued to weigh on sentiment and consumption opportunities remained restricted amid renewed containment measures (right chart, slide 3).
In other words, there was a substantial degree of monetary accommodation that, if preserved, could be expected to provide a measurable boost to aggregate demand and underlying price pressures. The Governing Council responded to these conditions with a powerful commitment to preserve favourable financing conditions. What distinguishes a policy of preserving favourable financing conditions?