The Bank of Japan (BOJ) today revised downward the outlook for the Japanese economy, which expects to grow 1.9% in fiscal year 2022 (ending March 31) compared to 2% in the previous estimate.
The most pessimistic view is justified by the impact of “the high prices of raw materials and the slowdown of foreign economies.”
Although the BOJ believes that the Japanese economy will recover in the medium term, the forecasts are less encouraging, mainly due to the expected global economic slowdown and the progressive loss of effectiveness of the economic measures adopted in response to this slowdown, the report says.
The central bank also lowered its forecast for gross domestic product growth. (GDP) for fiscal year 2023, expecting the national economy to grow 1.7%, compared with a previously estimated 1.9%, and lowered the forecast for fiscal year 2024 from 1.5% to 1.1 %.
On the other hand, the bank forecasts that inflation this year will rise to 3%, one tenth above the previously estimated and well above the initially defined target of 2%.
Despite the acceleration of inflation, and contrary to the trend observed among other reference institutions, such as the United States Federal Reserve (Fed) and the European Central Bank (ECB), the BOJ once again opted to maintain monetary policy, since it considers that this inflation is of an imported and transitory nature.
Source: Observadora
