the april 2018 outlook report, the real gdp growth rate is projected to be 1. 6 percent for fiscal 2018, and 0. 8 percent each for fiscal 2019 and 2020. let me explain the outlook in detail by major component. first, business fixed investment is likely to continue increasing. this is because, in a situation where extremely stimulative financial conditions are maintained, fixed investment will be positively affected by an improvement in corporate profits, the materialization of the effects of projects conducted under the fiscal investment and loan program as well as the effects of investment - enhancing tax incentives, and a moderate improvement in growth expectations. specifically, an increase is likely to be seen in investment such as, ( 1 ) that intended for domestic capacity expansion in line with the economic expansion ; ( 2 ) that related to the 2020 olympic games and urban redevelopment projects ; ( 3 ) that aiming at improving efficiency and saving labor in order to deal with, for example, the labor shortage ; and ( 4 ) in research and development for growth areas. private consumption is expected to follow a moderate increasing trend, due mainly to an increase in employee income as well as replacement demand for durable goods, and housing investment is expected to remain more or less flat. exports will likely continue their increasing trend for the time being, as those of capital goods and it - related goods, in which japan has a comparative advantage, are likely to be firm. thereafter, they are expected to continue their moderate increasing trend, due mainly to the improvement in overseas economies. industrial production will likely continue to increase firmly for the time being, and thereafter is projected to continue on a moderate increasing trend. the year - on - year rate of change in the cpi ( all items less fresh food ) is likely to increase toward 2 percent. this is because, although upward pressure of energy prices is likely to wane moderately, firms are likely to gradually shift their stance toward raising wages and prices with the improvement in the output gap, and inflation expectations are expected to gradually rise. looking at the medians of the policy board members'forecasts in the april 2018 outlook report, the year - on - year rate of change in the cpi ( all items less fresh food ) is projected to be 1. 3 percent for fiscal 2018 and - - on a basis excluding the effects of the scheduled consumption tax hike - - 1. 8 percent each for fiscal 2019 and 2020. developments in prices since the release of the april 2018 outlook report have been slightly weak relative to what had

percent, which, if we make a direct comparison, is the level seen in japan at the beginning of 1995. an increasing number of people are now interested in deflation. looking back at developments over the last decade, i have been struck anew by how immensely important it is for the central bank to gain reliable insights into the outlook for the economy. at the same time, we clearly cannot be too surprised at the fact that, with the passage of time, changes have taken place in the debate surrounding monetary policy. we at the central bank must continue to make efforts to gain new insights and learn from new ideas, while not allowing ourselves to fall captive to whatever mindset is dominant at a particular point in time. i feel acutely the importance of further interaction with the academic world, because cutting - edge research on financial and economic theory is fundamental to our efforts. since i assumed the office of governor in march this year, and indeed before, i have had the opportunity to listen to a wide range of advice, and have learnt much from opinions voiced about the bank and forwarded to me not only from members of the society but also from other academics both at home and abroad. at the same time, i am afraid that i must admit to feeling a certain degree of frustration, in the light of my long years of experience as a central banker, as i listen to some of the opinions. i cannot help but feel that there is still significant progress to be made in establishing a creative process whereby the bank first provides academics with sufficient information about the issues it is facing, and then works together with them based on the same information in its search for fresh policy solutions. we are fortunate to have among the current nine members of the policy board three members who have spent a number of years in senior academic positions. in addition, there are an increasing number of former bank staff currently working at academic institutions and devoting their efforts to bridging the gap between theory and practical policy. with their help, we expect to be able to extend our links with the academic world, thus not only gaining the benefit of academics ’ advice but also contributing to their research by sharing our practical experiences. this has been a somewhat protracted introduction. my aim today, however, is to share with you, as frankly as possible, my own current thinking with regard to the conduct of monetary policy, which i hope will be of interest to you. i hope also that my remarks will play a part in further strengthening the constructive