The Bank of Japan maintained its view on the economy and reiterated that “Japan’s economic conditions have stopped worsening.” The central bank left the overnight interest rate unchanged during its policy meeting earlier this week, and Governor Masaaki Shirakawa expressed some doubts about a pickup in future demand despite the rebound in exports and production. The comments from the BoJ suggests that the domestic economic may continue to face headwinds going into 2010 as households grapple with a weakening labor market paired with fears of a slower recovery.
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