The Bank of Japan on Monday kept its economic view almost unchanged saying that economic activity has started to pick up moderately as post-quake reconstruction continued to support domestic demand.
The economy is expected to return to a moderate recovery path buoyed by firm domestic demand and recovery in overseas economies, the central bank said in its monthly economic report.
BoJ said exports may increase moderately as overseas economies emerge from the deceleration phase. Public investment is expected to be on the rise and housing investment will continue to pick up.
Business fixed investment is also projected to continue a moderate increasing trend, partly due to efforts by firms to restore and reconstruct disaster-stricken facilities. Private consumption is expected to remain firm amid improving employment situation.
"Reflecting these developments in demand at home and abroad, production is expected to increase moderately," the central bank noted.
However, it warned of high degree of uncertainty about the global economy. Particular attention should be given to developments in global financial markets associated with the European debt problem, BoJ said.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.