- loaded ” purchases. however, many department stores, food supermarkets, and food services firms, for example, report that the decline in consumption has been broadly in line with expectations, and the extent of the decline has been narrowing gradually. this suggests that private consumption continues to remain resilient as a trend. the consumer confidence index bottomed out in april and has been improving for two consecutive months since then. the effects of the decline in demand following the consumption tax hike are likely to wane gradually from summer, partly due to an expected increase in summer bonuses. given that the effects of the decline in demand following the consumption tax hike are expected to gradually wane, private consumption is likely to remain resilient underpinned by the increase in employee income. nevertheless, since the effects of the decline in real income due to the consumption tax hike might gradually manifest themselves, the bank will continue to carefully examine future developments. firms ’ proactive stance and business fixed investment the second driving force of japan ’ s economic recovery is that favorable developments in the corporate sector have been continuing and recently have become more pronounced. business sentiment has stayed at a highly favorable level despite the decline in demand following the consumption tax hike. the business conditions di in the march tankan survey – the short - term economic survey of enterprises in japan – prior to the consumption tax hike improved to plus 12, reaching the highest level since the november 1991 survey ( chart 5 ). this improvement reflects the front - loading of demand prior to the consumption tax hike. the future di in the march tankan showed a substantial decline to plus 1 due to the decline in demand following the consumption tax hike. however, despite deteriorating due to the consumption tax hike, the business conditions di in the june tankan still registered a value of plus 7. this is notably higher than the di forecasted in the march tankan. moreover, this is the same level as in june 2007, prior to the global financial crisis, indicating that the di remains at a favorable level. thus, business sentiment has stayed at a favorable level even after the consumption tax hike, indicating that the stance of the corporate sector remains proactive. in addition, corporate profits have continued to improve. corporate profit projections in the june tankan survey show that the level of current profits in fiscal 2014 will remain at a level almost as high as in fiscal 2013. moreover, the projections have been revised upward compared to those in the march survey. it appears that firms have started to become confident

stock of the economy and raises the growth rate of potential output. investment spending can contribute to economic growth, whether it involves improvements in infrastructure, education and health, or investments in productive equipment, machinery as well as intangible assets and cutting - edge technologies. as a 1 / 4 bis - central bankers'speeches result of the increase in the stock of physical and human capital, labour productivity improves, and a sustainable rise in workers'real wages and living standards becomes possible. however, the persistently low level of productive capital accumulation has been a significant obstacle to productivity growth and convergence with the eu average. in particular, greece has witnessed a sizeable investment gap vis - a - vis the eu since the sovereign debt crisis. specifically, according to the european commission, 1 investment in real terms was almost 50 % lower in 2022 relative to 2008. the investment - to - gdp ratio, which hovered around 24 % before 2008 ( i. e. at a level comparable to the eu average ), collapsed during the crisis and averaged 11. 9 % in 2010 - 2020. a recent imf study estimates that the investment gap, according to certain measures, in greece reached up to 8 % in terms of gdp in 2019. according to the study, structural impediments have constrained corporate investment, while business cycle and balance sheet developments have held back household investment. the investment - to - gdp ratio has increased in recent years, as a result of strong investment growth in 2021 - 2022. corporate investment has recently fully recovered to pre - 2010 levels, while residential investment is low but growing at a rapid pace due to strong domestic and foreign demand from european and third - country investors in the context of the golden visa programme. however, the investment - to - gdp ratio still remains lower than the eu average ( 14. 3 % vs. 22. 0 % in the eu in 2023 ). however, it should be noted that it is not only the greek economy that faces an investment gap. rather, this holds also for the eu as a whole compared to the us. according to a recent eib study, 2 the investment gap between the eu and the us is attributed, among other things, to output dynamics, high cost of capital, financial constraints, corporate leverage and uncertainty. the drivers behind the gap include investment differences in machinery, equipment and innovation. in particular, there is a big gap in investment in ict equipment ( especially in the services sector ) and in intellectual property products. in