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Japan Central Bank Revamps Policy To Boost Economy

"They're an export economy," Akerson said. "You have to be suspicious of what they're doing and why."

But many economists say the rest of the world will benefit, too: A faster-growing Japan will buy more products and services from the United States, China and Europe, helping boost their economies.

"We could see some faster and sustainable growth now in Japan," said Bernard Baumohl, chief global economist at the Economic Outlook Group. "That will obviously help the global economy."

Japan's economy has been sputtering for two decades. Last year, weak consumer spending kept prices flat. The Bank of Japan hopes to increase inflation to 2 percent within about two years. Economists say Japanese consumers will start spending if they know prices are going rise.

Eswar Prasad, an economist at Cornell University, cautioned that Japan needs more than easy-money policies to repair its economy. It needs to reduce its debts and reform policies that protect weak firms from competition and undercut the country's productivity.

"Japan would no longer be a drag on the global economic recovery if it had stronger domestic demand and positive inflation," Prasad said. "However, it is far from clear that the Bank of Japan's actions will be able to deliver these positive outcomes in the absence of broader structural reforms that are essential to revive Japan's productivity and competitiveness. "

Critics also say that without wage increases to match the price hikes, many consumers may be even less willing to spend.

"The new BOJ's willingness to experiment should be welcomed," said Uri Dadush, director of the economics program at the Carnegie Endowment for International Peace. "But they are also inevitably wading into unknown waters. There is no certainty that the new approach will work."

Baumohl added that BOJ's move could backfire if other countries deliberately push down the value of their currencies to regain a price edge for their exports.

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