Categories: Banking

BOJ policymaker warns of uncertain recovery

Bank of Japan board member Toyoaki Nakamura has been warned of risks to the economic outlook because of the recent resurgence in COVID infections. They also gave a hope that consumption will get boosted, after the households feel safe to start spending. Nakamura said that the world’s third-largest economy is expected to recover. Because the pandemic’s impact is fading. This leads to a recovery in capital expenditure.

The former corporate executive said that, because of the emergency curbs to combat the pandemic, the outlook was highly uncertain. But Nakamura said that once vaccinations proceed, consumption may get a boost from pent-up demand with Japanese households. It has loaded up a record of 1,056 trillion yen in cash and deposits. Also, he stated in a speech that the resurgence in infections may have somewhat delayed the timing for when pent-up demand materializes. The economic activity may get even more strengthen after the pandemic’s impact eases.

Eight more prefectures are to be expanded by the Japan. This will take the total to 21. That will definitely create a rise in covid infections. Japan’s economy rebounded more than expected in the second quarter. This is sign for its development after the first hit of coronavirus. But many analysts are expecting further growth to remain modest in the current quarter.

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