On the price front, the year-on-year rate of change in the consumer price index (CPI) for all items less fresh food, or core CPI, despite being affected by the reduction in mobile phone charges, has been slightly positive, reflecting price rises in energy and other items (Chart 3).
Japan's economy is likely to recover as the impact of COVID-19 and the effects of supplyside constraints gradually wane. The year-on-year rate of change in the core CPI is also likely to increase in positive territory due to a dissipation of the effects of a reduction in mobile phone charges on the back of a moderate pass-through of raw material cost increases. B.