This was in response to both lower demand for, and restricted supply of, credit as banks applied stricter lending criteria in view of the increasing number of impaired loans. Despite these factors that were generally conducive to a decline in the inflation rate, there were other pressures and risks to the upside. Administered prices continued to exert upward pressure on inflation.
Business debt has grown faster than gross domestic product (GDP) for several years and today is high. But the growth in the ratio of business debt to GDP in the past decade is much less than the growth in household debt to GDP that we saw in the run-up to the Global Financial Crisis.