The results indicate that the higher is indebtedness, the greater is the sensitivity of spending to shocks to income.5 This is regardless of whether we measure indebtedness by the debt-toincome ratio or the share of income spent on servicing the debt.
That said, we are facing more challenges than ever on the economic front. In fact, I have said before that this may be the most difficult time since I joined the Monetary Board more than a decade ago. We are facing very difficult challenges. There is the very aggressive response of the US Fed [US Federal Reserve].