The first is to ensure corporate financing. To this end, it is essential to maintain financial system stability and accommodative financial conditions, thereby avoiding further downward pressure on the real economy from the financial side. The second point is whether firms’ and households’ growth expectations will decline and lead to cautious attitudes toward spending.
Some sort of hysteresis effects could arise after a large shock, as shown in protracted cautious firms’ behavior in Japan after the financial crisis in the 1990s. The Bank’s Response Next, I will talk about the Bank’s response. The Bank has enhanced monetary easing since March, implementing three measures as follows. The first is the Special Program to support financing mainly of firms.