Theeffects of the scheduled consumption tax hike and sudden market changes warrant careful vigilance so that the Bank's monetary policy will not fall behind the curve.
第2は、2019年10月に予定される消費税率引き上げの影響である。
The second risk is theeffects of the consumption tax hike scheduled to take place in October 2019.
当面は、消費税率引き上げの影響と世界経済の動向を慎重に見極めることが必要である。
It is necessary to carefully examine theeffects of the scheduled consumption tax hike and developments in the global economy for the time being.
The year-on-year rate of change in real income of employees as a whole,excluding theeffects of the consumption tax hike, has also been positive for nine consecutive months since March 2014 Chart 13.
From fiscal 2019 onward, the growth pace is projected to decelerate temporarily,due mainly to theeffects of the scheduled consumption tax hike, and recover gradually thereafter.
In fiscal 2019, it is expected to continue expanding, although the growth pace is projected to decelerate due to acyclical slowdown in business fixed investment and theeffects of the consumption tax hike scheduled in October 2019.
In addition, it is concerning that developments toward an economic downturn could heighten,depending on developments in overseas economies and theeffects of the scheduled consumption tax hike.
Effects of the consumption tax hikes At the beginning of October 2013,the government decided to raise the consumption tax rate to 8 percent in April 2014 as initially scheduled.
Attention needs to be paid tosuch factors as the slowdown in overseas economies and theeffects of the scheduled consumption tax hike in fiscal 2019, as well as a peak-out of Olympic Games-related demand and developments in the IT sector from fiscal 2020 onward.
However, the April 2014 Outlook Report clearly stipulates theeffects of the consumption tax hikes as a risk factor by almost reinserting the related description included in the October 2013 Outlook Report.
In fiscal 2019, the growth pace is projected to decelerate, mainly reflecting cyclical adjustments in capital stock after the prolonged economic expansion,Olympic Games-related demand peaking out, and theeffects of the scheduled consumption tax hike.
Thereafter, until early 2015, partly due to the effects of the consumption tax hike, the positive contribution ofthe CPI excluding energy-- and also excluding the direct effects of the consumption tax hike-- shrank.
The Consumer Price Index for the 2015 fiscalyear is forecast at 2.5%(1.8% excluding theinfluence of the consumption tax rate increase), and it is expected that the 2% inflation target will be nearly achieved in approximately 2 years.
In fiscal 2017, the economy is projected to maintain its positive growth, although with a slowing in the pace to around a level somewhat below thepotential growth rate due mainly to the effects of the consumption tax hike planned in April 2017.
Fortunately, people's short-term inflation expectations appear to be rising on the whole from a somewhat longer-term perspective, in part because the year-on-year rate of increase in the core CPI,excluding theeffects of the consumption tax hike, has continued to be stable at around 11⁄4 percent.
Turning to domestic risk factors,we need to bear in mind uncertainty regarding theeffects of the scheduled consumption tax hike that I mentioned earlier, as well as both upside and downside risks to developments in firms' growth expectations.
Specifically, it publicly made clear to"maintain the current extremely low levels of short- and long-term interest rates for an extended period of time, taking into account uncertainties regarding economic activity andprices including theeffects of the consumption tax hike scheduled to take place in October 2019.
In this context, the Regional Economic Reportreleased by the Bank on July 7 reported theeffects of the consumption tax hike on private consumption across Japan, and all regions, including Shizuoka Prefecture, have maintained their assessment that private consumption as a trend has continued recovering.
One member expressed the view that, in fiscal 2019, attention needed to be paid tosuch factors as the slowdown in overseas economies and theeffects of the scheduled consumption tax hike, and from fiscal 2020 onward, to such factors as a peaking-out of Olympic Games-related demand and developments in the IT sector.
Specifically, the Bank made clear that it would"maintain the current extremely low levels of short- and long-term interest rates for an extended period of time, taking into account uncertainties regarding economic activity andprices including theeffects of the consumption tax hike.
Regarding the specific time frame of"at least through around spring 2020," the staff explained that this took into consideration, for example, the timing at which pick-ups in overseas economies and the global cycle for IT-related goods were expected to be seen,and the period required for examining theeffects of the scheduled consumption tax hike after its implementation.
It has strongly committed itself to the intention of"maintaining the current extremely low levels of short- and long-term interest rates for an extended period of time, taking into account uncertainties regarding economic activity andprices including theeffects of the consumption tax hike scheduled to take place in October 2019.
Meanwhile, regarding theeffects of the consumption tax hike scheduled to take place in October 2019, one member stated that the negative impact on Japan's economy likely would be limited compared to the previous hike in 2014, due partly to the effects of various measures to be taken by the government.
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