Japan govt set to cut economic view for first time since 2012

TOKYO (Reuters) - Japan's government is set to cut its overall assessment on the economy in its monthly report to be released soon, taking into account an expected hit to private consumption from the April 1 sales tax hike, the Nikkei business daily reported.

The government is likely to retain the core phrase that the economy is "recovering moderately" from its March assessment given steady employment conditions, the Nikkei said.

It would be the first downgrade in the overall assessment since November 2012, the Nikkei added. The monthly report will be submitted to a meeting of relevant ministers on Thursday.

The downgrade would come a week after the Bank of Japan (BOJ) stuck to its upbeat assessment that the economy has continued to recover moderately, and follow a meeting between Prime Minister Shinzo Abe and BOJ Governor Haruhiko Kuroda on Tuesday.

Policymakers and private-sector analysts expect a temporary dip in economic activity in the current quarter due to the sales tax rise to 8 per cent from 5 per cent on April 1, before returning to moderate growth in the following quarters.

Join ST's Telegram channel and get the latest breaking news delivered to you.