AFP, Tokyo :
The Bank of Japan Wednesday held on to its upbeat view that Japan’s economy was recovering, despite GDP data that showed the country had unexpectedly slipped into recession, forcing a snap election.
Wrapping up a two-day policy meeting, the central bank kept policy unchanged-after expanding its already huge stimulus package last month-as investors eye BoJ governor Haruhiko Kuroda’s press briefing later in the day.
Markets want to see what Kuroda says about the government’s decision to delay a sales tax rise next year, after a levy hike in April slammed the brakes on growth just as the deflation-plagued economy appeared to be turning a corner. The BoJ chief-who was hand picked by Prime Minister Shinzo Abe-has repeatedly called on Tokyo to follow through on tax rises, which are aimed at generating fresh revenue to pay down Japan’s enormous national debt.
“With regard to the outlook, Japan’s economy is expected to continue its moderate recovery trend, and the effects including those of the subsequent decline in demand following the front-loaded increase prior to the consumption tax hike are expected to dissipate gradually,” the BoJ said in a statement.
Despite its bullish view on the overall economy, the bank was more cautious on inflation expectations, saying that they “appear to be rising on the whole from a somewhat longer-term perspective”.
The Bank of Japan Wednesday held on to its upbeat view that Japan’s economy was recovering, despite GDP data that showed the country had unexpectedly slipped into recession, forcing a snap election.
Wrapping up a two-day policy meeting, the central bank kept policy unchanged-after expanding its already huge stimulus package last month-as investors eye BoJ governor Haruhiko Kuroda’s press briefing later in the day.
Markets want to see what Kuroda says about the government’s decision to delay a sales tax rise next year, after a levy hike in April slammed the brakes on growth just as the deflation-plagued economy appeared to be turning a corner. The BoJ chief-who was hand picked by Prime Minister Shinzo Abe-has repeatedly called on Tokyo to follow through on tax rises, which are aimed at generating fresh revenue to pay down Japan’s enormous national debt.
“With regard to the outlook, Japan’s economy is expected to continue its moderate recovery trend, and the effects including those of the subsequent decline in demand following the front-loaded increase prior to the consumption tax hike are expected to dissipate gradually,” the BoJ said in a statement.
Despite its bullish view on the overall economy, the bank was more cautious on inflation expectations, saying that they “appear to be rising on the whole from a somewhat longer-term perspective”.
