TOKYO: All eyes were on the Bank of Japan (BoJ) Friday as more tepid data heaped pressure on policymakers to deliver a one-two punch for the sluggish economy, after Tokyo unveiled a huge growth-boosting package this week.
Central bank policymakers wrap up a meeting later in the day as speculation runs high that it will make a move, after a senior government official called on the BoJ this week to join forces with the government.
Japanese officials are under intense pressure to deliver as economists increasingly write off Prime Minister Shinzo Abe's faltering bid to fire up the world's number three economy, dubbed Abenomics.
The meeting is the BoJ's first since Britain's shock vote last month to quit the European Union.
The referendum result hammered financial markets and sparked a yen rally that is threatening corporate Japan's bottom line -- and aggravating concerns about growth.
Government figures on Friday morning did little to soothe those worries.
Spending by households across the country fell in June while inflation dropped for a fourth straight month, in a fresh blow to Abe's war on deflation.
While the labour market remained tight and industrial production rebounded, rising 1.9 percent, there are growing fears about second-quarter economic growth.
Japan dodged a recession in the first three months of the year.
Business confidence has slumped to levels last seen when Abe swept to power in late 2012 on a ticket to fire up an economy beset by years of falling prices and weak growth.
"The BoJ is widely expected to announce further significant monetary stimulus measures to support the large fiscal stimulus package that Shinzo Abe announced this week," said Craig Erlam, senior market analyst at forex trader OANDA.
Comments
Comments are closed.