Japan's markets may continue to fall

Japan's economy is at risk of deteriorating further as the global financial turmoil slows growth worldwide, central bank board member Seiji Nakamura said.

"Japan could be on the verge of long-term economic adjustments and the downside risks to the economy are increasing further," Nakamura said yesterday in a speech in Matsuyama, western Japan.

The Bank of Japan cut interest rates last month for the first time in seven years to stem damage from the worst global financial crisis since the Great Depression. The central bank won't rule out further monetary easing "if the economy deteriorates sharply", Nakamura told reporters after the speech.