Japan’s government maintained its economic view for the fourth straight month, but remained cautious about the market volatility amid falling bond yields and the weakening yen. <\/p>\n
In the monthly economic report, released by the Cabinet Office on Tuesday, the government repeated that the Japanese economy<\/span> is picking up moderately, while the slowdown of global economies poses downside risk to the Japanese economy. <\/p>\n Moreover, the report said full attention should be given to price increases, supply-side constraints and fluctuations in the financial and capital markets<\/span>. <\/p>\n The government raised its view on business<\/span> investment, saying capital expenditure is picking up. In September, the report had said “business investment shows movements of picking up.”<\/p>\n In response to rising prices and the weaker yen, reforms needed to spur growth remains the priority of the government, the report added. <\/p>\n The government retained its view on private consumption, exports, industrial production and corporate profits. The assessments on employment and inflation were also kept unchanged. <\/p>\n The Bank of Japan had intervened in the bond market last week after the 10-year Japanese government bond yield exceeded the cap of 0.25 percent.<\/p>\n Despite the fall in the currency, the BoJ is likely to keep its ultra-loose policy unchanged at its monetary policy meeting on October 27 and 28. <\/p>\n The weaker yen pushes up import prices of energy and food amid subdued wage growth, which ultimately dampen the Japanese household spending and economic growth.<\/p>\n The government expects the BoJ to achieve the price stability target of two percent in a sustainable and stable manner in light of economic activity, prices and financial conditions, the report said. <\/p>\n