Looking at wages, base pay increased for the first time in a long time in last year’s annual spring wage negotiations between management and labor based on the assumption that general prices would increase.
In addition, instead of simply searching for low-priced goods, consumers have started to purchase somewhat higher-priced goods provided that the quality matches the price, and firms’ price-setting stance has changed accordingly. These developments provide evidence of a rise in inflation expectations, indicating that there has been steady progress in changing the deflationary mindset.