The forecast for fiscal 2017 is lower than that for fiscal 2016 because the negative impact of the scheduled consumption tax hike on the economy will exert downward pressure on prices as well. I have explained the Bank’s baseline scenario so far.
My outlook for economic activity and prices is only slightly weaker, and I do not feel it is necessary to explain it in detail. Risk of economic deceleration In terms of economic activity and prices, there are indeed many risks that deviate from projections. Here, I will discuss solely the Chinese economy, over which uncertainty has been spreading since this summer.