BOJ: Japan's economy sustaining momentum for hitting 2% inflation, but momentum lacking strength

Reuters highlights further key points from the Bank of Japan’s (BOJ) Outlook Report.

Japan's economy expanding moderately as a trend, though slowdown in overseas growth affecting exports, output.

Consumer inflation moving in positive territory but remains on week note.

Medium – long-term inflation expectations have been more or less unchanged.

Japan inflation to gradually accelerate toward 2%.

Risks are skewed toward downside for economy, prices.

Japan's economy sustaining momentum for hitting 2% inflation, but momentum lacking strength.

Japan's economy likely to continue expanding as a trend.

No sign so far of excessively bullish expectations and asset markets, financial institutions activities.

Prolonged downward pressure on financial institutions profits from low rates could destabilize financial system.

Risk of financial system destabilizing not big for now as financial institutions have sufficient capital bases.

About BOJ Outlook Report

The Bank of Japan decides the text of the Outlook Report in April and October Monetary Policy Meetings and releases it semiannually after it has presented its outlook for developments in economic activity and prices, has carefully assessed upside and downside risks, and has outlined its views on the future course of monetary policy.

The USD/JPY pair holds the lower ground near 108.70 region after BOJ refrained from altering the current monetary policy.