The Bank provides a clear guideline for the levels of short- and long-term interest rates, in which it expects them to "remain at their present or lower levels" as long as it is necessary to pay attention to the impact of COVID-19. In other words, the Bank will cut short- and long-term interest rates appropriately when necessary.
However, a further decline in interest rates could affect the functioning of financial intermediation. In addition, it is true that because of this possible negative impact, one view in the market is that the Bank finds it difficult to further cut short- and long-term interest rates.