There is now more political stability than a year ago; much progress has been made with the framing and implementation of the Government’s Macroeconomic Strategy for Growth, Employment and Redistribution (GEAR); the Minister of Finance has confirmed and showed his determination to continue with the required policy of financial discipline that will gradually reduce the deficit in the Budget as a percentage of gross domestic product.
Additional stimulus, beyond the impetus already taken into account, is expected from the monetary policy measures still to be implemented and will contribute to further rebalancing the risks to the outlook for growth and inflation. In the current context, it is crucial to ensure that the very low inflation environment does not become entrenched in second-round effects on wage and price setting.