To be sure, 1997 is not 1994 when the Fed was forced to tighten monetary conditions very substantially to avoid accommodating rising inflation. Current financial conditions are much less accommodative than they were in 1994. Yet we must be wary.
A further rebalancing of economic growth, with less dependence on domestic demand and a stronger external performance, is therefore envisaged. Indeed, such a rebalancing is required in order to maintain a satisfactory overall performance and to put the economy on a sustainable path. This underlines the importance of preserving and improving the economy's competitiveness position.