Japanese economy sluggish

The Bank of Japan yesterday confirmed that it had downgraded its outlook for the economy. From Bloomberg yesterday:

"Japan's economic growth has been sluggish," the central bank said in its monthly economic report in Tokyo today, downgrading its evaluation for the second month. In July, policy makers said that the expansion was "slowing further."

But Japanese exports did pick up in July. Bloomberg reports:

Shipments overseas rose 8.1 percent from a year earlier, after declining for the first time since 2003 in June, the Finance Ministry said today in Tokyo. Shipments to China climbed 16.8 percent to a record, with the value surpassing those sent to the U.S. for the first time...

Imports climbed at the fastest pace in two years, surging 18.2 percent from a year earlier, as oil prices soared to a record. That caused the trade surplus to narrow 87 percent to 91.1 billion yen ($830 million), the ministry said.

China is fast becoming an important market for Japan, but there is increasing nervousness about the former's economic outlook as well, yesterday's surge in the Chinese stock market notwithstanding.