BOJ Kuroda Cites Slower-Than-Expected Economic Recovery

Economy Politics

Tokyo, Nov. 15 (Jiji Press)--Bank of Japan Governor Haruhiko Kuroda cited on Monday a delay in the recovery of the Japanese economy.

The economy has been continuing to pick up since hitting bottom in spring last year, but the recovery "has been somewhat slower than initially expected," he said in a speech in the central Japan city of Nagoya.

For the time being, downward pressure stemming from caution over the novel coronavirus crisis is likely to weigh on services-related consumption, such as dining out and accommodations, and exports and production are "expected to remain in a temporary deceleration phase due to supply-side constraints," Kuroda said.

On overseas economies, Kuroda said "it should be noted that the Chinese economy...has shown a deceleration in its growth pace recently" partly because of power shortages and the debt problem in the real estate sector. The BOJ will "closely monitor" how globally prolonged supply-side constraints and the deceleration in China's economic growth will "affect global financial markets and Japan's economy," he said.

But Kuroda said the BOJ believes that the mechanism for economic recovery "has been maintained." Noting that corporate profits and business sentiment are picking up, and that companies have been steadily spending on facilities and equipment, Kuroda said, "The improving trend in the overall economy, including the household sector, is expected to become quite evident in the first half of 2022."

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