Japan's government: world's No.2 economy has bottomed out

Japan's government raised its assessment of the economy for the second straight month and said the world's No.2 economy has bottomed out as exports and factory output recover from sharp declines.

The government lowered its outlook on capital expenditure, however, after Finance Ministry data earlier this month showed corporate spending posted a record fall in the first quarter from a year earlier, signalling that weak domestic demand will weigh on the recovery from the worst recession since World War Two.
'While the economy is in a difficult situation, movements of picking up are seen in some areas,' the Cabinet Office said in the monthly report released on Wednesday.
The report omitted an expression used to describe the economy last month, when it said 'the pace of deterioration is slowing'.
The upgrade is equivalent to saying Japan has hit bottom but further weakness cannot be ruled out, a Cabinet Office official said.

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