In addition, the statement by the Federal Open Market Committee (FOMC) has clarified the view that “it likely will be appropriate to maintain the current target range for the federal funds rate for a considerable time after the asset purchase program ends.” My understanding is that the Fed will communicate carefully with market participants in order to avoid bringing instability to financial markets.
Regarding the euro area economy, there are various adjustment pressures associated with the excess debt problems in the public and private sectors. However, the economy is expected to continue recovering moderately supported by ongoing recovery in domestic demand, reflecting improvement in various economic entities’ sentiment (Chart 8). As just described, advanced economies are likely to recover moderately, led by the U.S. economy.