A few of the Bank of Japan's policymakers said future economic developments will depend on whether exports and capital investment can offset the decline in consumption expected after the sales tax is hiked on April 1, the minutes of their February policy meeting showed Friday.
If household and business sentiment declines, it will be "necessary to closely monitor whether this would bring about a self-fulfilling economic downturn through a contraction in consumption and investment activities," one member said of the tax hike.
On exports, which lacked momentum despite the weakened yen, some BOJ Policy Board members said that "structural factors," including Japanese firms shifting production overseas, accompanied by increased local procurement by Japanese manufacturers, might be at work, according to the minutes of the Feb. 17-18 meeting.
Some members also pointed out that some firms appeared to put priority on domestic shipments to respond to firm domestic demand, while export shipments had been contained.