Governments and central banks took largely unprecedented fiscal and monetary policy measures to prevent the global recession from turning into a protracted depression. Some analysts said this was an over reaction. Others criticized the tyranny of the short term compromising medium term sustainability.
The fiscal deficit is the most worrying and despite plans for a drastic cut over the next few years, it may be difficult to achieve it in the light of the U.S. involvements worldwide, the likely increase in the interest rate on Treasury Bills, and a projected slowdown of economic growth from the high rate of 4.7% estimated for 2004.