During the three critical episodes, we noticed a marked mismatch in the demand for money that activated the warning signals on our instrument panel. Private sector time deposits showed a temporary decline, just as during previous financial crises. The same happened with the size of the capital account reversal.
Closing the output gap over this time frame is reliant on continued stimulative monetary policy and hinges critically on stronger exports and business investment. Weighing these considerations within the Bank’s risk-management framework, the monetary policy stance remains appropriate and the target for the overnight rate remains at 1 per cent.