Bank of Japan Gov. Haruhiko Kuroda on Wednesday expressed concern about the resurgence of coronavirus cases in Europe and the United States, saying the bank will remain vigilant against downside risks to the global economy.
Speaking at an online meeting with corporate managers in the Chubu region, Kuroda said the BOJ will keep tabs on the impact of the coronavirus pandemic on the economy and financial markets and take additional easing steps if necessary.
"There is concern that COVID-19 has been spreading again in Europe and the United States recently," Kuroda said.
In a policy-setting meeting last week, the BOJ maintained its ultraeasy monetary policy to support the pandemic-hit economy, cutting its growth and inflation forecasts for the current fiscal year through March.
The world's third-largest economy is now expected to shrink 5.5% in fiscal 2020, instead of the 4.7% contraction estimated earlier.
"There are high uncertainties over the outlook for economic activity and prices, and risks are skewed to the downside," Kuroda told business leaders in the region.
While the magnitude of the virus outbreak on domestic and overseas economies is "highly unclear," attention should be paid as to whether growth expectations among firms and households will decline, leading to "cautious spending attitudes," the governor said.
The coronavirus pandemic has made life even more difficult for the BOJ, which has so far failed to attain a 2% inflation target despite nearly eight years of monetary easing under Kuroda.
According to the minutes released Wednesday of the BOJ's policy meeting in September, one of the board members said it would be necessary to reconsider its strategy toward attaining the inflation target "comprehensively," claiming the path to the goal was not in sight due to a drastic change in the economic climate.