Especially given that the output gap has closed, excessive investment and stronger economic growth are likely to increase the risk of an eventual swingback. So far, no signs of excessive investment have been observed. In the face of intense global competition, firms seem to be selective in allocating their business resources.
Currently, financial markets have abundant funds, but recent growth is sluggish and deflationary pressure remains strong as economic entities such as firms and households are skeptical about future growth and unwilling to undertake forward-looking spending. To address this problem, the Bank has made more funds available for financial institutions to utilize in new areas of growth, in order to raise growth expectations.