First and foremost, this means creating stronger and more binding rules for fiscal policy, backed up by reinforced sanctions or mechanisms to ensure compliance with the rules. Second, a new framework is needed to monitor competitiveness and to ensure that measures are taken to control them. We need to put in place binding rules that guide policies towards sustainable and balanced growth.
The developments in Japan’s economy and prices I would like to start off with the recent developments in Japan’s economic activity and prices. The Bank of Japan introduced quantitative and qualitative monetary easing (QQE) in April this year with a view to bringing Japan’s economy out of deflation, which has lasted for nearly 15 years.