UPDATE-BOJ chief sees economic recovery from next fiscal -Nikkei

Dec 11 (BestGrowthStock) – Bank of Japan Governor Masaaki Shirakawa
said the domestic economy may shake off the current lull
beginning next spring, the Nikkei business daily reported on
Friday.

“The slowing pace of improvements may last for a while, but
the economy will return to a path of gradual recovery starting
next fiscal year,” the paper quoted Shirakawa as saying in an
interview.

The central bank may look into further monetary easing
should it become necessary, the daily said.

“Should the economic picture deviate sharply from our
forecasts, we may consider an expansion to the program,” said
Shirakawa, the paper reported.

The corporate fundraising environment in Japan is turning
around, partly due to the BOJ’s 5 trillion yen asset-purchasing
program, he told the paper in an interview.

BOJ last month eased monetary policy by pledging to keep
rates effectively at zero until the end of deflation was in
sight and announcing a plan to spend 5 trillion yen ($60
billion) on assets ranging from government bonds to corporate
debt. [ID:nTOE6AO08E] [ID:nTKZ006657]

Shirakawa said the Japanese economy’s growth potential
needs to be restored for price declines to disappear, Nikkei
reported.

Unless steps are taken to address issues such as expanding
the working population and boosting productivity, “expectations
for growth will not emerge and deflation will not be
corrected,” the daily quoted him as saying.

Deflation is seen as easing since last summer as the
Japanese economy recovers from the worst recession in decades,
but the pace of improvement has been slow in recent months.
[ID:nTOE6AO08E]

Shirakawa also expressed concerns about the European and
the U.S. economic outlook, and said “we will remain
consistently cautious,” the paper reported.
(Reporting by Saqib Iqbal Ahmed in Bangalore; Editing by
Gopakumar Warrier)

UPDATE-BOJ chief sees economic recovery from next fiscal -Nikkei