million or 6.6 per cent of GDP experienced in fiscal year 2015-16, reflective of continued investment in tourism and infrastructure.
It is also forecasting that headline inflation will end this calendar year below two per cent before tracking back up to the lower end of the target range of 4.5 per cent to 6.5 per cent by March 2017.
“This rise in the March 2017 quarter is simply the statistical consequence of dropping from the 12-month series the deflation that occurred in the months of January, February and March of 2016,” said Wynter. He said actual prices increases between now and March are projected to average around 0.4 per cent per month.
In the inflation expectations survey conducted in August, expected inflation 12 months ahead declined to 3.3 per cent from 3.8 per cent in the May survey, the BOJ governor said.