MNI POLICY: Japan Govt Ups Economic View; 2nd Straight Month

--Japan economy shows recent signs of picking up

     TOKYO (MNI) - Japan's government upgraded its economic assessment compared

to the previous month, with exports bottoming out and production showing signs

of picking up.

     The economic assessment published Wednesday is the second straight upward

revision, and follows June's which was the first upward revision since January

2018.

"The Japanese economy is still in an severe situation due to the Novel

Coronavirus, but it is showing movements of picking up recently," the latest

report said.

     The previous assessment was "The Japanese economy is still in an extremely

severe situation due to the Novel Coronavirus, but it (has) almost stopped

deteriorating."

     In April, the government used the wording "worse" in describing economic

climate, for the first in almost 11 years.

     --UPS CONSUMPTION, EXPORTS, PRODUCTION

     The government also upgraded its assessment of private consumption, exports

and production, for a second straight month, the first back-to-back upward

revisions since February 2017 and July 2019, respectively.

"Private consumption is picking up recently," the report noted, adding that

exports are "bottoming out, although the influence of the infectious disease

remains."

     Industrial production "shows signs of picking up recently in some sectors,

although it is decreasing as a whole."

--TWEAKS FIRMS' JUDGEMENT

     The government tweaked its assessment on business condition, saying that

firms' judgment shows "movements" of improvement, although some severe aspects

remain.

     As for the near-term outlook, it said, the economy is expected to show

signs of recovery, helped by stimulus measures and an easing of social

distancing rules.

     It also said that however, attention should be given to the "risk that"

domestic and overseas infections "would affect economies. Also, full attention

should be given to the economic impact of the heavy rain of July 2020, and the

effects of fluctuations in the financial and capital markets.

--MNI Tokyo Bureau; tel: +81 90-2175-0040; email: hiroshi.inoue@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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