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Source: Central Bank of Iceland

A more accommodative monetary stance has supported asset markets, enabled households and businesses to deal with the repercussions of the pandemic, and maintained financial stability. The reduction in the countercyclical capital buffer and measures to boost market liquidity have made it easier for financial institutions to work with distressed borrowers while simultaneously maintaining their lending capacity. In the Committee’s opinion, cyclical systemic risk has not increased to any marked degree in the recent term.

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