This is what I referred to earlier as the elimination of deflationary expectations. A rise in the expected inflation rate will not only influence actual prices but also stimulate private demand through a decline in real interest rates.
Developments in economic activity and prices Looking at recent developments in economic activity and prices, it seems that the conditions are being prepared to demonstrate the effects of the quantitative and qualitative monetary easing through the three transmission channels that I just mentioned. Indeed, Japan’s economy has shown some bright signs of picking up.