The decline in crude oil prices since autumn 2014 had exerted downward pressure on inflation expectations through the adaptive formation mechanism. Looking ahead, however, this effect is likely to be neutral to inflation expectations or slightly push them up.
The direct impact on consumer prices of a rise in crude oil prices and the yen's depreciation are observed only temporarily and will dissipate after a while. Nonetheless, if these developments lead to a rise in medium- to long-term inflation  6  expectations, there will be a persistent rise in the inflation rate.