If households and firms can successfully respond to such developments, this could raise medium- to long-term expected growth rates and thereby further strengthen the virtuous cycle in the economy. B. Price Developments in Japan Next, I would like to talk about price developments in Japan.
The economic recovery and the outlook for price stability are still predicated on the very favourable financing conditions that to a large extent depend on continued monetary policy support. Therefore, we need to look through the volatility in short-term data resulting from transitory factors in order to assess whether progress towards a durable and self-sustaining convergence in the path of inflation has been sufficient.