In Japan, although firms in the basic materials industry have swiftly raised prices because the practice of passing on cost increases to selling prices based on a particular formula has taken hold in this industry, firms in processing and consumption-related industries, which are closer to final demand, tend to absorb cost increases by reducing margins, and this tendency appears to be stronger in Japan than in the United States and Europe.
We all have an obligation to ensure that the institutions we supervise are able to meet their contractual obligations. Now and in the future. Our pension funds and insurance companies will still need to be able to pay out their obligations 50 years from now. While we also want our banks to be safe for decades to come.