“Japanese consumers are making deeper cutbacks after the March 11 earthquake than anticipated, heightening the urgency for policy makers to unveil measures to end the nation’s third recession in a decade.
Household spending had the largest back-to-back quarterly drop since the global financial crisis, the Cabinet Office said yesterday. The figures contrast with comments by Japan’s central bank, which holds a policy meeting today, that the economy’s main challenge is one of supply chain disruptions caused by the earthquake, tsunami and nuclear crisis.
Prime Minister Naoto Kan, whose public approval rating is less than 30 percent, has held off on outlining the scale of further reconstruction spending as officials gauge the impact of an initial 4 trillion yen ($49 billion) package. BOJ Governor Masaaki Shirakawa has taken a similar stance since the central bank expanded its asset-purchase fund on March 14.”
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