effects of deceleration in overseas economies, it has nevertheless been an element steadily underpinning japan ’ s economy. outlook for japan ’ s economy with regard to the outlook, as i mentioned at the outset, japan ’ s economy is expected to remain relatively weak for the time being, and thereafter, it is expected to return to the bis central bankers ’ speeches moderate recovery path toward the middle of the year as domestic demand remains resilient and overseas economies gradually increase their brightness. as a recovery is the one following some periods of relatively weak developments and the pace will be moderate, firms might have difficulty realizing an economic recovery. however, there is a good possibility that “ with hindsight the first half of 2013 was the turning point. ” as mentioned earlier, there is a silver lining in overseas economies and, in particular, it is encouraging that the u. s. economy is on a recovery trend. in addition, the recent developments in the yen exchange rate will gradually underpin exports. in domestic demand, public investment is likely to continue to be on an increasing trend and housing investment likely to also continue to pick up. in the not distant future, business fixed investment will likely return to the moderate uptrend partly due to investment related to disaster prevention and energy. private consumption is likely to remain resilient as a trend, with the effects of the decline following the expiry of subsidies for the purchase of energy - efficient cars subsiding. prices on the price front, the year - on - year rate of change in the consumer price index ( cpi ) excluding volatile food is around 0 percent. for the time being, it is expected to turn negative due to the reversal of the previous year ’ s movements in energy - related and durable consumer goods, and thereafter, is likely to be around 0 percent again for some time and then gradually increase its rate of change with economic recovery. taking into account such developments in economic activity and prices, the monetary policy meeting last week examined the outlook for economic activity and prices for the next two years. looking at the median of the policy board members ’ forecasts, the real gdp growth rate, following + 1. 0 percent in fiscal 2012, is somewhat high at + 2. 3 percent for fiscal 2013, partly due to a surge in consumer spending prior to the consumption tax hike. in fiscal 2014, while there will be some reversal developments, the growth will be + 0. 8 percent exceeding the potential growth rate. the year - on

trend change in prices. as a measure to prompt an improvement in the aggregate supply and demand balance, in terms of interest rates, the bank has kept the policy rate at the effectively zero level. to encourage a further decline in longer - term interest rates in the money market, the bank introduced in december 2009 a new funds - supplying operation, through which funds with a maturity of three months are provided at an extremely low interest rate of 0. 1 percent, and the total amount of loans to be provided through this operation was set at approximately 10 trillion yen. the total amount of loans was increased to 20 trillion yen in march 2010. in terms of funds provision, the bank has been providing ample funds through various fundssupplying operations, including the new operation. furthermore, the bank has made its stance clear that it will consistently maintain the extremely accommodative financial environment. as for inflation expectations, the other determinant of prices, the bank has, to prevent people ’ s expectations for prices from declining, clearly showed its stance, in the form of the “ understanding of medium - to long - term price stability ”, that it is critical to achieve a positive year - on - year rate of changes in the cpi. to overcome deflation and achieve a sustainable economic growth with price stability, the bank will continue to consistently make contributions as central bank.