Therefore, whether emerging and commodity-exporting economies will be able to achieve a soft landing and return to a sustainable growth path is an issue that warrants careful attention. A domestic issue that warrants attention is the possibility that fluctuations in business and household sentiment might affect economic activity.
For example, the appreciation of the yen may on the one hand encourage mergers and acquisitions abroad – a positive development – but on the other it is also likely to exert downward pressure on the profits of exporters and might damage economic activity if this were to hurt business confidence and lead firms to change their behavior.