Some measurement constraints also exist, including the fact that (1) there are no precise indicators measuring the inflation expectations of households and firms; (2) statistical bias is included in some survey data – for example, households’ inflation expectations tend to be upwardbiased in Japan, while the diffusion index (DI) for expected sales prices in the Tankan (ShortTerm Economic Survey of Enterprises in Japan) tends to be downward-biased; (3) in terms of market-based indicators, the impact of the Bank’s JGB purchases needs to be taken into account; and (4) the breakeven inflation rate (BEI) indicator also reflects the differences in liquidity between fixed-rate and inflation-indexed bonds.
Nevertheless, as prices and economic activity firmly improve and as the process of increasing inflation expectations becomes clearer, I personally feel that, in the longer-term view points, there may be an opportunity to refine the second set of guidance with more specific information.