The following is the unedited transcript of the news release from the Cabinet Office of Japan

The economy is recovering at a moderate pace recently. Corporate profits improvement appears to be pausing and business investment is increasing moderately. The employment improvement appears to be pausing while some severe aspects remain. Private consumption is almost flat. Housing construction remains at a low level while showing a pick up. Exports are increasing moderately and industrial production is growing at a slower pace.

As for short-term prospects, moderate recovery is expected to continue while business investment and exports generally increasing. However, attention should be given to downside risks increased by the slowdown of the U.S. economy and the fluctuations in the financial and capital markets mainly caused by the subprime mortgage loan problem, and effects of developments of oil prices.

(Policy stance)

The Government will promote reforms based on the """"Direction and Strategy for the Japanese Economy"""" and the """"Economic and Fiscal Reform (Basic Policies) 2007"""" in an integrated manner. The Government will steadily implement the supplementary budget for FY 2007 and other measures.


In order to ensure sustained economic growth led by private-sector demand while achieving a stable level of inflation rate, the Government and the Bank of Japan conduct policies by sharing basic perspectives on macroeconomic management indicated in the above mentioned Basic Policies.


Available at:

http://www5.cao.go.jp/keizai3/getsurei-e/2008feb.html