Monday’s report from the bank says the damage may turn out to be the equivalent of 4 percent of the nation’s economic output. The bank predicts that growth will pick up as reconstruction efforts accelerate.
Tokyo markets were closed Monday for a national holiday , but share prices declined most of last week. They rallied Friday after the G-7 group of industrialized nations pledged joint action to help Japan by pushing down the value of the yen.
Japan’s economy is heavily dependent on exports, and the recent sharp rise in the yen hurts exports by making Japanese-produced products more expensive on world markets. The yen’s value had been growing as speculators bought the currency, predicting it would gain as Japanese companies sold foreign assets and brought that money home to fund reconstruction.
In the meantime, Japanese companies are working to restart production at the many factories that closed right after the earthquake. Workers had to cope with damage some plants, shortages of power and parts, as well as transportation problems. Nissan says it can resume activities at five factories this week, while Toyota and some other companies still have a number of plants closed.
Some of the closed facilities produce parts used to assemble autos in other nations, and the parts shortage is causing production problems around the world.
U.S.-based General Motors, for example, is slowing or stopping production at some plants in the United States, Spain, Germany and South Korea.
Shortages of key Japanese-made electronic parts is also slowing production or raising prices at overseas factories that assemble electronic products.