The sharp slide in oil prices threatens to halve Japan's inflation rate over the next six months, while cheaper mobile phone bills and free nursery education could even push it below zero.
This view from private sector economists is very much at odds with the Bank of Japan's forecast for its core inflation gauge to average 1.4 percent in the fiscal year starting in April. It also points to BOJ sticking with its monetary stimulus program for a longer period.
Citigroup Inc. economists Kiichi Murashima and Katsuhiko Aiba forecast that falling oil alone will push down core inflation, which excludes fresh food, to 0.5 percent by next June from about 1 percent now.