MNI BRIEF: BOJ Sees Downside Risk To Economy Easing Slightly

The Bank of Japan sees the scale of downside risk to the economy as reduced somewhat from three months ago as weakness has been limited to eating and drinking services and accommodation and hasn't filtered through to other sectors, MNI understands.

Although private consumption on the whole was sluggish in the first quarter, bank officials are of the view that labour and income conditions held up better than expected based on recent unemployment rates and wage hike data from the Japanese Trade Union Confederation. Machinery orders and feedback from companies confirmed solid capital investment backed by robust corporate profits globally.

However, the growing number of virus infections remains a risk factor as it could worsen household and business sentiment.