the ongoing strengthening in aggregate demand are enough to countervail disinflationary forces. We will get the 2016 inflation outlook in March. Would a rate cut help if it turned out that inflation is moving too slowly back towards the target of below but close to 2 percent?
Under these circumstances, some borrowers will be more dependent than in the past on banks for credit, but banks are still reluctant and very cautious lenders. Banks have been reducing their book of loans for about a year; in part, this drop reflects weaker demand as businesses have cut back on inventories and households have been rebuilding their balance sheets by increasing saving.