Chart 6  Output Gap 3.0  %  Excess demand (upward pressure on prices)  2.0 1.0 0.0 -1.0 -2.0 -3.0  Excess supply (downward pressure on prices)  -4.0 -5.0 -6.0 CY 2013/Q1  Q3  14/Q1  Q3  15/Q1  Source: Bank of Japan. Note: Based on staff estimates.
As the underlying cover pools are mainly composed of government bonds and mortgages, developments in these markets are of fundamental importance to the Pfandbrief. Sound public finances, a healthy housing market and a stable economic environment are the pillars that underpin the reliability of the Pfandbrief.