BoJ's upbeat outlook and risks

Japan will report a 1-2% annualized contraction in real GDP for Apr-Jun, though it looks as if preliminary data, due out 17 August, to some extent, this was already factored into the BoJ's growth outlook announced last month. 

The key point will be the BoJ's outlook for Jul-Sep onward. Kuroda said at the press conference following the last monetary policy meeting that the factors behind the slowdown in growth in Apr-Jun, a decline in exports to the US and destocking in the auto sector, are likely to be temporary. 

A decline in Apr-Jun GDP would be in large part a snap-back to Jan-Mar's strong growth (3.9% annualized). If Jan-Mar and Apr-Jun is averaged , growth remained slightly above the economy's potential growth rate.

"Moreover, going by June industrial production and employment data released after the last monetary policy meeting, strong domestic corporate earnings are continuing to drive capex and jobs growth. The BoJ has likely not changed its overall view that the Japanese economy is on a recovery track", says Bank of America.