BOJ cuts views on 5 of 9 regional economies on COVID, parts shortages
Written by tokyoclub on October 7, 2021
The Bank of Japan on Thursday downgraded its economic assessments on five of the country’s nine regions amid the lingering impact of the coronavirus pandemic as well as supply shortages of semiconductors and other components that have hit manufacturers.
In its quarterly Sakura report, the central bank maintained its views on the remaining four regions, including the Tokyo area. The Japanese economy remains in a “severe” situation despite its recovery as a trend, it said.
Bank of Japan Governor Haruhiko Kuroda (far L) attends a teleconference with BOJ branch managers from the central bank’s head office in Tokyo on Oct. 7, 2021. (Kyodo) ==Kyodo
Some regions reported “a pause in signs of a pick-up due to the effects of the spread of the novel coronavirus during this summer and production cutbacks in some sectors,” the BOJ said.
Tohoku, Tokai, Kinki, Chugoku, Kyushu, and Okinawa are the five regions that saw their assessments cut. The views on the remaining four — Hokkaido, Hokuriku, Kanto-Koshinetsu and Shikoku — were maintained.
The assessments came after a COVID-19 state of emergency that had covered 19 of the country’s 47 prefectures was lifted at the end of September.
“Economic activity, mainly in the face-to-face services sector, is expected to remain at a level lower than before the spread of the coronavirus for the time being,” BOJ Governor Haruhiko Kuroda told a meeting of the bank’s branch managers.
But he also said economic activity is expected to recover with the impact of the virus gradually waning.
Shortages of components, including semiconductors, have dealt a blow to manufacturers, particularly automakers.
The BOJ is scheduled to hold its next regular monetary policy meeting on Oct. 27 and 28.