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56039
Fri, 04/17/2009 - 19:38
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https://oananews.org//node/56039
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BOJ lowers assessment for 7 of 9 regional economies+
TOKYO, April 17 Kyodo - The Bank of Japan on Friday downgraded assessments on seven out of the nation's nine regional economies on slowing consumption and a sharp drop in capital investments, with BOJ Governor Masaaki Shirakawa pointing to a risk of further weakening of the nation's economy.
In its quarterly ''Sakura Report'' on regional economies, the BOJ lowered its
assessment for the Hokkaido, Tohoku, Hokuriku, Kanto-Koshinetsu, Kinki, Shikoku
and Kyushu-Okinawa regions. It left its view unchanged only for the Tokai and
Chugoku regions.
The central bank released the report after a meeting of managers from the BOJ's
32 branch offices.
Japan's ''economic conditions have been ''deteriorating significantly,'' the
report said in its overall assessment, noting that drastic deterioration in
exports and corporate profits dampened business sentiment and capital
investments.
Consumer spending was also weakening as employment and income conditions got
severe, the report said.
''Our country's economy is highly likely to continue to deteriorate for the
time being,'' Shirakawa said at the opening of the central bank's meeting with
its branch managers.
Shirakawa also raised the deflation alarm, saying, ''Japanese wholesale prices
are likely to keep falling for the time being, reflecting falls in
international commodity markets and others.''
Japanese wholesale prices in March dropped 2.2 percent from a year earlier for
the sharpest fall in nearly seven years due to falling demand amid the
weakening economy.
Shirakawa said consumer prices excluding perishables are also likely to start
falling in the future after recent government data showed Japan's key consumer
price index remained flat in February.
Given a series of dismal Japanese economic indicators and the tone of
Shirakawa's comments, the bank will probably cut its forecast further when it
releases its semiannual outlook on April 30, analysts said.
In January, the central bank lowered its outlook for real gross domestic
product growth in the fiscal year to March 2010 to a 2 percent contraction,
down from the 0.6 percent rise it had forecast in October.
According to the central bank's Tankan survey released earlier this month,
business confidence among major Japanese manufacturers tumbled to its
weakest-ever level during the three months through March.
International financial and capital markets remain under ''severe strain,''
Shirakawa said, noting that an increasing number of Japanese companies both
large and small are struggling to obtain funds.
In dealing with the global financial crisis and the economic slump, the BOJ has
decided to take a series of unorthodox measures, including offering up to 1
trillion yen to commercial banks in subordinated loans to help boost their
capital, in addition to two rate cuts in October and December.
The central bank said it will make ''utmost contributions'' to help get the
Japanese economy back on a sustainable growth path with stable prices.
==Kyodo
In its quarterly ''Sakura Report'' on regional economies, the BOJ lowered its
assessment for the Hokkaido, Tohoku, Hokuriku, Kanto-Koshinetsu, Kinki, Shikoku
and Kyushu-Okinawa regions. It left its view unchanged only for the Tokai and
Chugoku regions.
The central bank released the report after a meeting of managers from the BOJ's
32 branch offices.
Japan's ''economic conditions have been ''deteriorating significantly,'' the
report said in its overall assessment, noting that drastic deterioration in
exports and corporate profits dampened business sentiment and capital
investments.
Consumer spending was also weakening as employment and income conditions got
severe, the report said.
''Our country's economy is highly likely to continue to deteriorate for the
time being,'' Shirakawa said at the opening of the central bank's meeting with
its branch managers.
Shirakawa also raised the deflation alarm, saying, ''Japanese wholesale prices
are likely to keep falling for the time being, reflecting falls in
international commodity markets and others.''
Japanese wholesale prices in March dropped 2.2 percent from a year earlier for
the sharpest fall in nearly seven years due to falling demand amid the
weakening economy.
Shirakawa said consumer prices excluding perishables are also likely to start
falling in the future after recent government data showed Japan's key consumer
price index remained flat in February.
Given a series of dismal Japanese economic indicators and the tone of
Shirakawa's comments, the bank will probably cut its forecast further when it
releases its semiannual outlook on April 30, analysts said.
In January, the central bank lowered its outlook for real gross domestic
product growth in the fiscal year to March 2010 to a 2 percent contraction,
down from the 0.6 percent rise it had forecast in October.
According to the central bank's Tankan survey released earlier this month,
business confidence among major Japanese manufacturers tumbled to its
weakest-ever level during the three months through March.
International financial and capital markets remain under ''severe strain,''
Shirakawa said, noting that an increasing number of Japanese companies both
large and small are struggling to obtain funds.
In dealing with the global financial crisis and the economic slump, the BOJ has
decided to take a series of unorthodox measures, including offering up to 1
trillion yen to commercial banks in subordinated loans to help boost their
capital, in addition to two rate cuts in October and December.
The central bank said it will make ''utmost contributions'' to help get the
Japanese economy back on a sustainable growth path with stable prices.
==Kyodo
