Forward guidance is a measure that makes clear the stance on future policy rates in advance in order to strengthen market confidence and expectations regarding monetary policy.
Also, the expansion in the output gap in the economy is expected to slow as the economic stimulus package is implemented. In the immediate future, however, prices are likely to weaken reflecting the present high inventory level and the relatively large output gap. In the financial markets, both long and short-term interest rates followed a declining trend with the releases of weak economic indicators.