The underlying trend of consumer spending has been quite solid recently due to the improvement in the job and wage market. Consumption was strong last quarter and played a key role in supporting growth and we can expect further growth from consumption this year.
Capital spending is strong and will continue to be a key driver of growth. Japan's economy has clearly emerged from last year's lull and will enjoy steady growth supported by domestic demand.
It's going just as everyone has been expecting. We'll probably see the year-on-year (CPI) increase jump to 0.3 or 0.4 percent next month as the effect of one-off factors last year fades, giving the BOJ more confidence about a policy change.
It's mainly a backlash from the powerful momentum of the last half-year.