05 September 2013 07:32 [Source: ICIS news]
SINGAPORE (ICIS)--The Bank of Japan (BOJ) said on Thursday that the country’s economy is recovering moderately, partly on the back of a pick-up in exports, and that it will maintain its plan to increase the monetary base by as much as yen (Y) 70,000bn ($701bn) a year.
An increase in the monetary base has an inflationary effect. The country has been battling to overcome deflationary pressures that has lasted for nearly 15 years.
“Japan's economy is recovering moderately,” the central bank said in a statement.
“Overseas economies as a whole are gradually heading toward a pick-up, although a lackluster performance is partly seen. In this situation, exports have generally been picking up,” it added.
Looking ahead, the BOJ said that the year-on-year increase in the consumer price index (CPI) is “likely to rise gradually”.
However, the central bank warned that there remains a high degree of uncertainty surrounding Japan’s economic growth, including the debt crisis in Europe, developments in emerging and commodity-exporting economies as well as the pace of recovery in the US economy.
“The Bank will continue with quantitative and qualitative monetary easing, aiming to achieve the price stability target of 2%, as long as it is necessary for maintaining that target in a stable manner,” it added.
Japan is the world’s third largest economy and is a major producer of petrochemicals.
($1 = Y99.8)
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