TOKYO, July 15 (UPI) -- The Bank of Japan said Tuesday it had reduced its expectations for economic growth and increased its prediction of inflation in the country.
Economic growth, previously expected at a rate of 1.5 percent through March 2009 is now expected to grow at an annual rate of 1.2 percent, the bank said.
The Bank of Japan, which left its key lending rate unchanged at 0.5 percent after a two-day meeting Tuesday, made an even larger correction in its inflation estimate.
The bank projected inflation -- estimated in April to be 1.1 percent -- would reach 1.8 percent, the Financial Times reported.
"Economic growth is slowing further, reflecting weaker growth in business fixed investment and private consumption against the backdrop of high energy and materials prices," the bank's statement said.