TOKYO (MNI) – The Bank of Japan on Wednesday offered a more upbeat
assessment of the outlook for overseas economies, saying it had observed
some improvement recently.

“Overseas economies still have not emerged from a deceleration
phase but some improvement has been observed,” according to the BOJ’s
April economic report released Wednesday.

This was more positive than the BOJ’s assessment in March, when it
said simply: “Overseas economies still have not emerged from a
deceleration phase on the whole.”

The BOJ also upgraded slightly its overall economic assessment from
the previous month, reversing the order of its comments to emphasize
signs of activity picking up.

On Wednesday, the BOJ said: “Japan’s economic activity has shown
some signs of picking up, although it has remained more or less flat.”

In March, the BOJ said: “Japan’s economic activity has remained
more or less flat, although it has shown some signs of picking up.”

The assessment of public investment was also upgraded.

“Public investment has recently started to increase,” the latest
report said.

In March, the BOJ said: “Public investment has stopped declining.”

The BOJ left basically unchanged its assessments of exports and
industrial production, saying that they are likely to pick up in the
coming month.

The BOJ also maintained a cautiously optimistic view on the
outlook for Japan’s economy.

“Japan’s economy is expected to return to a moderate recovery path
as the pace of recovery in overseas economies picks up, led by emerging
and commodity-exporting economies, and as reconstruction-related demand
after the earthquake disaster gradually strengthens,” the BOJ said.

The BOJ’s policy board on Tuesday voted unanimously to maintain
practically zero short-term interest rates to help support a recovery
from deflation but also left the scale of its financial asset-buying at
Y65 trillion after raising it in February.

The BOJ maintained its assessment that Japanese economy would
gradually recover, led by improving overseas economies, but warned that
uncertainties over the outlook for global growth remain.

The BOJ has left its target for the overnight interest rate among
commercial banks at zero to 0.1% since October 2010, when it lowered it
from 0.1% as part of “comprehensive monetary easing.”

The BOJ will hold its quarterly branch managers’ meeting on
Thursday in Tokyo.

tokyo@marketnews.com
** MNI Tokyo Newsroom: 81-3-5403-4833 **

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