The Consumer Price Index (CPI), excluding fresh food, had been declining at around 0.8 percent on a year-on-year basis until early 2003. However, the rate of decline diminished steadily thereafter. Recently, in October, it marked an increase of 0.1 percent for the first time in five and a half...

The Bank of Japan (BOJ) estimates the output gap and the potential growth rate, and uses these in judging economic and price conditions. The output gap and potential growth rate have been recently re-estimated in light of the benchmark revision of the GDP statistics at the end of 2005. At the...