Bank Of Japan:No need to review economic outlook

AOMORI (Kyodo) - Bank of Japan Deputy Governor Hirohide Yamaguchi said Wednesday he does not feel that the central bank needs to review its outlook for the Japanese economy amid rising crude oil and food prices.
The central bank's view is that the Japanese economy is emerging from a pause, and Yamaguchi said in a speech in the northeastern city of Aomori that Japan will return to a moderate recovery path ''in the not so distant future.''
But he also expressed concern about the possible adverse impact of rising commodity prices on the global economy, touching on the uncertain situation in the Middle East.
Yamaguchi told a press conference later that commodity price movements could affect the Japanese economy both ''positively and negatively'' and that he wants to carefully monitor the impact.
Likely factors behind the rising prices include increasing demand in emerging economies, unfavorable weather and aggressive monetary easing in developed economies that has led some investment funds to channel money into commodity futures markets, he said.
On the downgrading by Moody's Investors Service Inc. of its Japanese sovereign debt rating outlook, Yamaguchi said the revision has not had a ''big impact'' on Japan's long-term interest rates, but acknowledged that the country needs to restore its fiscal health.
Moody's said Tuesday it has trimmed its rating outlook for Japanese government bonds to ''negative'' from ''stable,'' suggesting a possible downgrade in the future.