The Bank of Japan sees a more volatile recovery path ahead as rising waves of the coronavirus abroad cloud the recovery outlook and spark renewed nerves in markets.
The BOJ cut its growth forecast for the current year while keeping its key interest rates and asset purchases unchanged, according to a statement from the central bank Thursday. Amid the heightened uncertainty over the outlook the central bank said it was ready to take further action if needed. All but one of 43 surveyed economists forecast a stand-pat decision.
The bank now sees the economy shrinking 5.5% in the year to March from a 4.7% drop forecast previously, citing a delayed recovery in the services sector. It raised its growth projection for the following year to 3.6%, suggesting a wider gap between recession and recovery.