At some point, however, when the temporary disinflationary impetus of the favorable supply developments dissipate, not only will there be some rebound in inflation, but unless a transition is made back to sustainable utilization rates, there will be a risk of a continuous upward movement in inflation. During that transition, at least some of the earlier decline in core inflation will be reversed.
As anticipations of real estate price increases formed owing to the abundant global liquidity, mortgage lending for the purpose of speculative housing purchases also expanded sharply. In the US and other advanced countries, moreover, mortgage securitization and the transfer of credit risk were made easier thanks to the development of advanced financial techniques. This acted as an additional factor boosting household debt.