Companies are expecting consumer prices to rise at an average rate of 1.5 percent year-on-year, a Bank of Japan survey showed Wednesday, falling short of the central bank's inflation target of 2 percent.

The companies also said they expect prices to rise 1.7 percent over the next three years, and the same rate of inflation for the next five, the BOJ said. The price outlook was included for the first time in the BOJ's "tankan" quarterly corporate sentiment survey.

According to the survey, covering more than 10,000 Japanese companies, 29 percent said they expect consumer prices to increase around 1 percent, while 19 percent said they project prices to climb around 2 percent.

The survey indicates widespread skepticism about the central bank's stated goal of achieving 2 percent inflation between late fiscal 2014 and the first half of fiscal 2015 under its large-scale monetary easing policy involving the massive supply of funds.

The companies were asked to exclude the effects of April's consumption tax hike from their responses, the BOJ said.