Bank of Japan officials are likely to discuss raising their economic outlook slightly in a quarterly report due later this month after signs conditions have improved earlier than expected, people familiar with the matter said.

BOJ officials see a strong recovery in the United States and China as a driving force for Japan’s export-reliant economy, the people said. While uncertainties remain high due to rising virus cases at home, the government’s decision to target its measures to control the spread of infection have helped limit the overall economic damage, the people said.

That leaves scope for a slight upward revision to the BOJ’s growth projections for the fiscal year that started this month and for next year, according to the people. The bank’s current forecasts released in January are for economic growth of 3.9% in the year started April 1 and 1.8% in the following year.

Because the pickup has been firmer than expected back in January, when the BOJ last released its projections, there is probably room to also upgrade the estimate for the 12-month period that ended in March, the people said. The January forecast was for a 5.6% contraction. No decision will be made until all the data is examined in the days before the April 26-27 meeting, they said.

On prices, officials view the underlying trend as basically holding up, but they see a possibility of a slight downgrade to projections for the current fiscal year due to one-off factors, including reduced costs for cell-phone service, the people said.

The forecasts due this month will for the first time extend through the end of Gov. Haruhiko Kuroda’s term in fiscal 2023. Officials see it as unlikely that the bank will be able to project 2% inflation even then, with the number probably being somewhere around 1%, the people said.

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