19 Sep 2009

Bank of Japan now upbeat about economy

7:25 am on 19 September 2009

The Bank of Japan has issued an upbeat assessment of the Japanese economy and hinted it may soon withdraw some emergency support measures.

Along with other central banks around the world, the bank has been pumping money into the economy to help stimulate demand.

The BoJ said that keeping these measures in place too long could hinder an "autonomous recovery."

On Thursday, deputy governor Hirohide Yamaguchi said the economy was now entering a positive cycle.

The BBC reports the Japanese economy emerged from recession in the second quarter of this year after four consecutive quarters of deep contraction.

Despite the comments, the BBC reports leading Japanese stocks slipped slightly. The main Nikkei 225 index closed down 0.7%.

On Thursday, the BoJ decided to keep interest rates at 0.1%. It also said that a stronger yen could support the Japanese economy in the long run, despite it making exports more expensive. The yen is up 6.7% against the dollar since June.