Moreover, given that the formation of inflation expectations is highly adaptive in Japan, the longer the rate of inflation remains stagnant, the less likely inflation expectations are to rise. As I have explained, if there are repeated resurgences of COVID-19, prices are expected to remain stagnant for a protracted period, with both the output gap and inflation expectations being pushed down.
It is clear that the MSME sector is prospective in terms of credit and business management, and more importantly, there is a relatively big portion of this sector that is capable to absorb and conduct healthy principles of economics without the need for subsidies.