If the backlog of unexploited long-term profitable technologies remains high, it should be assumed that once currently elevated risk premiums and the heightened cost of equity capital (and some debt) recedes, or cash flows expand, new productivityenhancing capital investment will pick up.
Thereafter, assuming that medium- to long-term inflation expectations remain stable, the rate of change is likely to gradually turn positive as the negative output gap narrows. In its forecast released in January 2012, the Bank projected the year-on-year rate of increase in the CPI (all items less fresh food) to be 0.1 percent for fiscal 2012 and 0.5 percent for fiscal 2013.