MNI BRIEF: BOJ Sees Downside Risk; No Urgent Policy Shift

The Bank of Japan warned of various downside risks to overseas economies and indicated it will not phase out its easy policy, according to the full text of the BOJ Outlook Report publishd Monday.

"Although the pace of recovery in overseas economies is projected to remain slow for the time being, they are likely to pick up gradually thereafter," the report noted. "However, there are extremely high uncertainties surrounding them, and downside risks have remained a particular concern.”

The BOJ noted four risks, such as uncertainties over price developments and policy interest rate hikes by central banks, the possibility that the functioning of financial intermediation will decline as credit risks materialise, concern over developments in IT-related demand and a delay in China's economic recovery due to prolonged adjustments in the real-estate market, employment and income.