Japan's Economy Expected to Continue Making Mild Recovery, Finance Minister Says

By Megumi Fujikawa

TOKYO--The Japanese economy is expected to continue making a mild recovery on the back of increases in wages and capital expenditures, Finance Minister Shunichi Suzuki said.

"Corporate performance and their financial conditions remain generally sound," he said at a news conference Tuesday.

Suzuki also said that the yen's appreciation will have both positive and negative effects on the economy via lower import prices on the one hand but weaker overseas profits for Japanese companies on the other.

The yen briefly hit around 139.60 versus the dollar on Monday, the strongest level since July 2023. The level is stronger than the 145 level assumed by many Japanese companies in their earnings projections. According to analysts, if the yen remains strong companies may need to lower their profit projections.

Write to Megumi Fujikawa at megumi.fujikawa@wsj.com