BOJ chief expects grim times ahead

Bank of Japan Governor Masaaki Shirakawa said conditions are severe for Japan's economy and he is examining the effects of quantitative easing, as government officials become increasingly concerned about a deepening recession.

"In addition to falling exports due to a slowdown in overseas economies, corporate profits, household finances and job conditions are worsening, and it is taking a toll on domestic private demand," Shirakawa told a parliamentary finance committee two days before his policy board meets to review rates.

"Output, employment and consumption data were all severe," he said, in remarks that sent government bond futures rising.