Broad-based weakness supports case for more easing

While the economic recovery seemed to have picked up pace at the start of the year, recent data have dashed hopes of rapid growth. Consumers are not spending the windfall from lower energy prices, and firms are raising wages by less than anticipated. With the sharp slowdown in inflation threatening to undermine expectations of future price rises, we remain convinced that the Bank of Japan will step up the pace of easing later this month.