The Bank maintains its policy stance that, when there are changes in trend inflation due to manifestation of risk factors, it will make adjustments without hesitation if judged as necessary to achieve the price stability target at the earliest possible time.
Thereafter, while the economy will be affected by the frontloaded increase and subsequent decline in demand prior to and after the two scheduled consumption tax hikes, it is likely to continue growing as a trend from fiscal 2013 toward fiscal 2015, at a pace above its potential, as a virtuous cycle among production, income, and spending is maintained (Chart 1).