TOKYO (MNI) – The Bank of Japan on Thursday offered a more cautious
outlook for the country’s industrial production and exports in the face
of the slowing global economy, the persistent strong yen and massive
flooding in Thailand.
“Exports and production are expected to be more or less flat for
the time being and increase moderately thereafter, mainly reflecting a
pick-up in the pace of recovery in overseas economies,” the BOJ said in
its monthly report for November.
It is a downward revision from its assessment in October that
production will “continue increasing at a moderate pace” and exports
will “trend up moderately, due in part to the restocking of inventories
abroad.”
In today’s report, the BOJ also said, “According to anecdotes by
firms and other information, production to restock inventories and cope
with the past orders is expected.”
“But effects from the supply-chain disrupted by the flooding in
Thailand and the slowing global economy as well as the high yen are
expected and the production for the fourth quarter is likely to be more
or less flat.”
It also warned that “there is a risk that adverse effects from the
disrupted supply chain will become bigger” while adding that the supply
chain may recover more quickly than expected.
After its two-day policy meeting, the BOJ on Wednesday slightly
revised down its overall economic assessment, saying: “Japan’s economic
activity has continued picking up but at a more moderate pace due to
effects of a slowdown in overseas economies.”
The downward revision was the first time in five months since the
BOJ lowered its view in the wake of the March 11 earthquake disaster.
tokyo@marketnews.com
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