As part of our experiences with previous changeovers to the euro, we know that we have to monitor carefully that prices are converted properly, and that the changeover should not be used as an occasion to raise prices in an unfounded and inordinate manner.
Under such accommodative financial conditions, Japan’s economy has been recovering moderately, accompanying a virtuous cycle among production, income, and spending. On the price front, the year-on-year rate of change in the CPI, excluding fresh food, had been below zero percent for a prolonged period of some years, but finally has risen to around 1¼ percent (Chart 12).