Firms and households can only reactivate spending such as investment and consumption when clear prospects of a demand recovery following the resolution of various structural problems are in sight, future uncertainties with respect to employment and wages are dissolved, and a stable financial environment is in place.
Regarding fiscal policies, the increasingly solid and broad-based expansion strengthens the case for rebuilding fiscal buffers. This is particularly important in countries where government debt remains high. All countries would benefit from intensifying efforts towards achieving a more growth-friendly composition of public finances.