Similarly, there is no guarantee that the current wave of investment will earn high returns. So a relevant forecasting question here is how these risks are likely to play out and how they are influenced by the way in which the increase in the capital stock is financed.
In thinking about each of these three questions – the impact on potential growth, the implications for inflation and the changing risk profile of the economy – it is the combination of judgement, models and liaison that I discussed a few moments ago that we rely on.