On the downside, the cooling off that we are currently observing in housing markets could become more severe, and both residential construction and consumer spending could take a larger hit than expected. A substantial slowing in these two categories of final demand would likely induce some businesses to curtail or delay investment projects.
On the upside, we cannot say exactly why the level of investment has remained low for the past few years, so we certainly cannot rule out a return to previous higher trends. In that regard, we do seem to be seeing a strengthening in global demand, which could signal a more pervasive change in attitudes and expectations.