Prime Minister Naoto Kan attended a meeting of the Ministerial Council on Monthly Economic Report and Other Relative Issues at the Prime Minister's Office.

The Monthly Economic Report for July assesses the current state of the Japanese economy, stating that "Upward movements are observed in the Japanese economy while difficulties continue to prevail, due to the Great East Japan Earthquake."

On prospects for the economy, it states "Concerning short-term prospects, reflecting a moderate recovery of overseas economies and the effects of policy measures, the economy is expected to resume picking up as progress is being made in restoring the supply chains and, thereby, production activities are recovering. However, there are downside risks that could stem from constraints of electric power supply, the consequences of the nuclear accident and high oil prices, and further slowing down of overseas economies. It should also be noted that there is still a risk of the adverse effects of deflation on the economy and a concern about a possible deterioration of the employment situation."