— See Separate Tables for Details

TOKYO (MNI) – Economists on average have revised down their
forecasts for Japan’s economic growth in October-December to an
annualized 2.13% drop from -2.03% in the previous survey, but they have
revised up their projections for January-March GDP to +1.11% from
+0.67%, according to the latest monthly survey by the Cabinet Office’s
Economic Planning Association released on Thursday.

The Cabinet Office will release preliminary Q4 GDP on Monday.

The survey also showed that the number of the economists who expect
the Bank of Japan to ease credit further totaled seven, down from 13 in
the previous survey.

By contrast, economists expecting a credit tightening in the next
12 months totaled 35 this month, up from 28 in January.

The average economist forecast for real GDP growth was revised up
to +1.47% from +1.39% for fiscal 2011 and down slightly to +2.04% from
+2.06% for fiscal 2012, the ESP survey showed.

The average forecast for fiscal 2010 GDP was +3.22%, unchanged
from the previous survey.

These forecasts compared with the BOJ board’s Jan. 25 median
projection at +3.3% for fiscal 2010, +1.6% for fiscal 2011 and +2.0% for
fiscal 2012.

Meanwhile, the survey showed that economists expect the
year-on-year change in core consumer prices to return to positive
territory in fiscal 2012 with a 0.19% gain over fiscal 2011, revised up
from +0.14% projected in the previous poll. This will follow three years
of continued price drops.

The average economist forecast for the core CPI (excluding fresh
food but including energy) for fiscal 2011 ending on March 31, 2012 was
-0.07%, revised up from -0.18% forecast in the previous survey.

These private-sector forecasts are weaker than the latest median
projections by the BOJ policy board at +0.3% for fiscal 2011 and at
+0.6% for fiscal 2012 that were presented at the Jan. 25 policy meeting.

The average economist forecast for the core CPI was -0.80% in the
current fiscal year ending March 31, up from -0.85% in the previous

In fiscal 2009, the average national core CPI fell 1.6% after
rising 1.2% in fiscal 2008. The FY09 drop was the first in five years,
since -0.2% in fiscal 2004.

The association polled 43 economists and research institutions from
Jan. 27 to Feb. 3 for its ESP Forecast, and 43 answered on the growth
and inflation outlook and 42 on the BOJ’s monetary policy stance.

The previous survey was conducted from Dec. 24 to Jan. 6.

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