Domestic wholesale prices are also declining somewhat faster because the effects from high crude oil prices and the depreciation of the yen in the past have dissipated, while prices of electrical machinery and materials continue to decrease. Consumer prices are weakening owing mainly to the decline in prices of imported products and their substitutes. Corporate service prices continue to decrease.
Of course, there's much more to the story than just the exchange rate. Powerful forces have been shaping the global economy. These include the emergence of the economic powerhouses of China and India, and large and growing financial imbalances in the United States and Asia. As a result, we have seen large movements in relative prices, and not just the realignment of exchange rates.