The Bank of Japan downgraded its view of the economy for the sixth consecutive month Monday, reinforcing fears that the slump will further delay needed structural reforms.
"Adjustments in economic activity are becoming more severe," the central bank said in its monthly report. "If the downturn in U.S. consumption persists, it may cause a further decline in exports and further dampen economic activity."
The BOJ said the Sept. 11 attacks in the United States exacerbated a global economic slowdown, making the outlook for Japan uncertain.