Despite weaker corporate balance sheets and elevated uncertainty about the economic outlook, business investment has shown resilience. Looking ahead, the progress with vaccination campaigns, which should allow for a gradual relaxation of containment measures, should pave the way for a firm rebound in economic activity in the course of 2021.
Obviously, if the shock was large enough, we could not rule this out, but my guess is that it is highly unlikely. Throughout our work on household debt, we have assumed that lending standards of financial institutions, as typified by maximum debtservice ratios, have not been relaxed. This might be an over-simplification but, if it is, it is not a large 6 one.