In sum, Japan's economy is likely to achieve sustainable growth under price stability. This outlook is based on the assumption that market participants and firms have, to some extent, factored future changes in monetary policy into their decisions. Therefore, for economic activity and prices to develop in line with the above outlook, adjustment in the level of the policy interest rate seems necessary.
The outlook remains that of manageable inflation expectations, “within-target” inflation rates for 2009 and 2010, continuing remittances from overseas Filipinos, a surplus BOP position, market-driven peso value and interest rates that are responsive to our market’s needs. Already the current low interest rate environment provides an interesting market backdrop for this point.