BOJ's Suda Offers Grim Outlook

YAMAGATA, Japan—Bank of Japan policy board member Miyako Suda said Wednesday that Japan's economy may be in for a prolonged slowdown, with deflationary pressures continuing to drag on the economy well into next year.

"I think the possibility that on-year changes in the core consumer price index, which excludes fresh food prices, will come out of negative territory in the next fiscal year [ending March 2012] is not high, and improvement toward overcoming deflation will likely take some time," Ms. Suda said in a speech to business leaders in this northern Japan city.