The Bank of Japan has revised downward its forecast for the real-term gross domestic product in fiscal 2020, from 0.8-1.1% in the previous forecast in January, to minus 5.0 to minus 3.0%, according to the "Outlook for Economic Activity and Prices," which the BOJ released Monday.
The report is released quarterly as a prevailing view among BOJ Policy Board members.
As to its assessment of the overall economy, the central bank lowered it from the previous one, saying that "Japan's economy is likely to remain in a severe situation for the time being." In its previous assessment released in March, the BOJ said, "Japan's economy is likely to remain weak."
In the forecast made by Policy Board members, the release of the median was put off, probably due to a strong sense of uncertainty of the future outlook.
As for the year-on-year rate of change in the consumer price index (CPI, all items less fresh food), for fiscal 2022, which has been presented anew by the bank, it is expected to be plus 0.4-1.0%. It will be affected by the fact that the CPI forecast for fiscal 2020 has turned negative.
Fiscal 2022 is the final year in office for BOJ Gov. Haruhiko Kuroda, whose term will expire in April 2023. There have so far been no prospects for the realization of the year-on-year rate of change in CPI to reach a 2% increase, which Kuroda set as a target when he assumed the governorship in 2013.
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