Against this background, reflecting a substantial fall in crude oil prices since summer 2014 and a slowdown in emerging economies from 2015 through 2016 accompanied by turbulence in the global financial markets, the observed inflation rate declined, dragging down inflation expectations as well.
The Bank aims to drastically convert the deflationary mindset entrenched among people and re-anchor inflation expectations at 2 percent, but this has met with difficulties. Given that QQE is unprecedentedly powerful, due attention also has to be paid to side effects that could materialize going forward.