People cross a street in Shinjuku district in Tokyo on Feb 18, 2023. (PHOTO / AFP)
TOKYO – Japan kept its assessment of the economy unchanged in February as consumer spending remained on a recovery trend despite soft exports and factory output due to the global economic slowdown.
The government also retained its caution over the impact of global monetary tightening, price hikes and supply constraint in its monthly report. It will continue to closely monitor financial market fluctuations, according to the report.
The new economic assessment comes after data last week showed Japan's economy averted recession but rebounded much less than expected in the fourth quarter last year as business investment slumped
The new economic assessment comes after data last week showed Japan's economy averted recession but rebounded much less than expected in the fourth quarter last year as business investment slumped.
ALSO READ: Japan's economy shrinks as inflation, slowdown take toll
"The economy is picking up moderately, although some weakness is seen recently," the Cabinet Office said in its monthly economic assessment, which was unchanged from January.
Consumer spending, which accounts for more than half of Japan's gross domestic product (GDP), was "recovering moderately" as people spent on eating at restaurants and travelling as well as purchasing autos, according to the report.
The government's campaign to subsidize domestic travel and the easing of border control steps boosted tourism, the report said.
The Cabinet Office described exports as "weakening recently", unchanged from the January report, while recovery in Japan's factory output was "stalling".
READ MORE: Japan's current account surplus falls the most since 2008
Uninspiring data highlights the delicate task at hand for academic Kazuo Ueda, the government's nominee to become the next central bank governor, as he plots a path to normalizing the bank's ultra-easy policy without derailing a fragile economic recovery.