The year-on-year rate of change is expected to record a slight increase and remain positive thereafter. As for the outlook, a reduction in electricity charges and other special factors are likely to exert downward pressure on consumer prices from April 2006, the beginning of the next fiscal year.
At the same time, there will be other special factors placing upward pressure on consumer prices, so that the net effect remains uncertain. The Bank, however, thinks it unnecessary to change its view that the year-on-year change in the CPI is expected to remain positive in view of the gradual narrowing of the output gap.