Thinking behind the outlook for prices Let me turn to the year-on-year rate of change in the CPI (all items less fresh food). The Bank’s baseline scenario is that the timing of the rate of change reaching around 2 percent will likely be at the end of the projection period — that is, around fiscal 2018.
Even if the growth rate per working-age population is high, as long as the per capita growth rate is decreasing, downward pressure to demand could impede macroeconomic growth. Third, we may need to consider the so-called “spending wave” hypothesis (Chart 10). For one reason, the Japanese asset price bubble was caused by Japanese baby boomers who experienced their peak spending years, particularly, for mortgages.