The Bank strongly expects that such an action will contribute to the stable price formation in the market. 2  BIS central bankers’ speeches  The sovereign debt problem in Europe was triggered by the fiscal deficits, but it has started to affect economic activity in Europe through the financial system.
If the economy deteriorates, it becomes more difficult to make progress with fiscal consolidation, which is the starting point of the problem. It should be recognized that the problem entails the risk that the adverse feedback loop among the fiscal situation, the financial system, and economic activity will intensify further.