The rise in medium- to long-term expectations for growth and income – together with an alleviation of future concerns over fiscal conditions and the social security system – may gradually lead to a situation where mild inflation is more readily acceptable. •  Such an attitude among households is likely to affect firms’ price-setting behavior.
Until recently, many firms have found it easier to raise their sales prices since the yen’s depreciation and the consumption tax hike provided an opportunity for them to increase the prices of most of their products and services simultaneously and collectively.