- The government is expected to maintain its expansionary fiscal policies in H1 2024, which should have a positive effect on the private sector’s liquidity condition.
- Despite the sizable fiscal expansion, its impact on household consumption remains uncertain given the household sector’s low saving balance and the positive real interest rate.
- Anaemic demand growth from the household sector may tempt the central bank to start loosening its posture. However, such a strategy would be detrimental to the effort to improve the private sector’s liquidity condition.
