From 1.6% to 0.6% the new estimate for national GDP. The economy minister said he was "confident" about restarting the economy. But many would like the central bank to purchase government debt to avoid a possible tax increase.

Tokyo (AsiaNews / Agencies) - The Bank of Japan (BoJ) cut estimates on economic growth in Japan during 2011-2012, for damages caused by earthquake and tsunami, and foresees a GDP growth of 0.6% compared to the initial hypotheses of 1.6%. However, the Minister of Economy and Fiscal Policy Kaoru Yosanu said he was "confident that the production system will recover sooner than expected," although today's data is "devastating."

Masayuki Kichikawa, chief economist at Bank of America-Merrill Lynch in Tokyo, warns that by mid year, the BOJ will be forced to seek "additional incentives" to make up for the apparent weakening. Kichikawa also supports the idea proposed by a group of parliamentarians who have asked the central bank to buy government debt, to prevent the financing of the reconstruction of the country passing through a tax increase. But the governor of the Bank of Japan, Masaaki Shirakawa, has repeatedly declared his opposition to a "more aggressive" stimulus such as the direct financing of government debt, which could fuel inflation.

Since February, production has fallen by 15.3%, the biggest drop since the country began to record their data in 1953. Household spending slipped to 8.5% , compared to last year. The fall in consumption per capita is the strongest in 13 years.

At the end of March, the government estimated the damage caused by the disaster, which caused at least 26 thousand victims among dead and missing, may reach 25 trillion yen, about 306 billion dollars.

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