BOJ downgrades economic views for two of nine regions

The Bank of Japan, in a quarterly report released Thursday, downgraded its economic assessments for two of the country’s nine regions, against the backdrop of spreading coronavirus infections.

The two are Hokkaido and the northeastern region of Tohoku. The assessments for the seven other regions were kept unchanged.

In the Regional Economic Report, the BOJ indicated that many regional economies are picking up but showed concerns about the pandemic’s impact on the restaurant, hotel and other industries involving face-to-face services.

In particular, the central bank cited strong downward pressure on consumption of services in the Kinki region including Osaka and Hyogo prefectures, where pre-emergency measures against the pandemic are currently in place.

At a meeting of BOJ regional branch heads on Thursday, Gov. Haruhiko Kuroda indicated the central bank’s emphasis on providing financial support for companies and maintaining financial market stability.

Following the meeting, Osaka branch chief Hirohide Koguchi told a new conference that the contrast between strong exports and production and weak private consumption is increasingly visible.

Koguchi said the number of visitors to department stores, large consumer electronics outlets and other facilities in the center of the city of Osaka is currently about 10% to 20% lower than in mid-March.

The branch chief expressed a sense of alarm about the effects on the regional economy of a possible further increase in coronavirus infections.