The consumer price index rose by about 1 per cent in 1996, and the indicator of underlying inflation, which serves as a basis for monetary policy, was even more subdued. During the summer and autumn months, a lively public discussion ensued on the possibility of deflation.
There were however no signs of a general decline in the price level, and the entire configuration of asset prices, for example trended upward. Exports and investment provided less-than-expected stimulus to economic growth in 1996, but owing to a healthy rise in private consumption expenditure, total output is estimated to have grown by nearly 3 per cent.