At this point, it is hard to tell how much of this tightening was in train already, after continued increases in interest rates, and it is likewise difficult to say how much the stress in midsized banks will ultimately curtail credit in the coming year.
In India, with the more than expected moderation in GDP growth in the second quarter of 2011–12, and  6  BIS central bankers’ speeches  given the persistence of headwinds from weak global macro-financial conditions, the importance of fiscal space would be better appreciated.