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The BOJ is evaluating the risk that deteriorating conditions for some services could ripple into other industries, undermining prospects for the moderate economic recovery that it expects, MNI understands. The BOJ's latest Tankan and the quarterly branch managers' meeting have both highlighted out that businesses in manufacturing and non-manufacturing, excluding in-person services, are recovering.
BOJ officials are of the view that labour and income conditions on a macro basis continue to remain firm, underpinning its recovery scenario. However, they are concerned that the quasi-emergency restrictions imposed on services such as restaurants could have a negative spillover impact, especially if virus infections stay high.