The Bank of Japan on Monday downgraded its assessment of Japan's economic performance and noted that the recovery is slowing down.
"Japan's economy continues to recover gradually, albeit at a somewhat slower pace due to decelerating export growth," the central bank said in a monthly report on recent economic and financial developments.
The BOJ downgrade is its first since July 1998, when Japan was haunted by concerns about financial unrest and the risk of a deflationary spiral due to successive business failures the previous year -- including major brokerage Yamaichi Securities Co.