BIS Review 104/1998  –2–  Let me explain why I think these factors have had such an impact this time around. First, the matter of incautious international investment practices – what was the problem here? With the opening up of financial markets and with the decline in interest rates in industrial countries, a growing number of investors were attracted to higher returns abroad.
We know, however, that business expectations have remained well anchored to the target. Indeed, the Bank’s Business Outlook Survey shows that, since the second quarter of 2009, at least 80 per cent of businesses canvassed have reported that they expect inflation to remain between 1 and 3 per cent over the next two years.