The effort to raise labor productivity in the non-manufacturing sector to the level of the manufacturing sector will result in a higher economic growth rate over the coming decade, although it works to delay the timing in overcoming deflation in terms of the core consumer price index, due to sustained downward pressure on the unit labor cost.
The chart shows how many insurers would hold insufficient own funds based on various assumptions regarding future interest rate movements. In the baseline scenario, it is assumed that excess returns on insurers’ bonds revert to their historical mean and that yields on Federal bonds, or Bunds, increase in line with market participants’ current expectations.