The Japanese economy is expected to keep improving at a "moderate" pace, Bank of Japan (BoJ) Governor Masaaki Shirakawa said today.
"Our nation's economy is likely to keep picking up, but the pace is likely to be moderate for the time being,'' Shirakawa said in a speech at the outset of the BoJ's quarterly meeting of branch managers to assess the economy and price developments in each region.
Production and exports have been increasing thanks to progress in inventory adjustment and pick-ups in overseas economies, especially in emerging economies, the BoJ chief said.
A falling trend in corporate capital investment is coming to an end but with corporate earnings remaining sluggish, a quick recovery in companies' investment in business equipment is unlikely, he added.
Meanwhile, although income and employment conditions remain severe, personal consumption mainly on durable goods has been picking up and the trend is likely to continue thanks to stimulus measures, he said.
The BoJ meets with managers from its 32 branch offices, together with senior officials from overseas offices and the head office, every three months to grasp the state of regional economies in order to steer monetary policy.
The outcome of today's meeting is due out in the afternoon in the form of the Sakura Report, akin to the US Federal Reserve's Beige Book.