"Many regions said the economy is picking up on robust domestic demand backed by improvements in household and business sentiment, as well as a pick up in overseas demand"
-Bank of Japan
The Bank of Japan's aggressive stimulus programme is considered as successful, as the economy is on the track to a steady recovery, with signs of inflation expectations also picking up, the BoJ's Governor Haruhiko Kuroda said during the quarterly report. The BoJ also raised its assessment of eight out of nine Japan's regional economies, compared with three regions month ago, cementing speculations of positive effects of the government's reflationary policies, which are spreading across the country.
Kuroda also stressed out that core consumer prices, which were almost flat during the last months, are turning into a positive territory, reflecting improvements in the economy. The BoJ is widely expected to stand pat at its interest rate review, and may even revise up its growth outlook, based on growing evidence that government's actions and the significant depreciation of the Japanese Yen are supporting exports as well as private consumption. The improvement has been noticed practically in all sectors of the economy, however, it still has to nudge businesses to raise wages and jobs, raising doubts on whether the recent strength in consumer spending is sustainable. At the same time, wages showed no annual increase for the second month in a row in May.
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