* BOJ more upbeat on U.S. growth, sees geopolitical risks
* BOJ likely to maintain assessment on exports
* Exports remain soft spot in otherwise robust economy
(Adds detail, context)
By Leika Kihara
TOKYO, June 9 The Bank of Japan may slightly
raise its assessment of overseas economies on Friday, people
familiar with the bank's thinking said, a sign that the bank
remains confident that sluggish exports will pick up and help
Japan's economy achieve a sustained recovery.
Robust U.S. jobs data and rising Wall Street stocks have
heightened confidence within the BOJ that the world's largest
economy has exited a soft patch blamed largely on severe winter
weather, said the sources, who asked not to be named.
"External risks have subsided somewhat," one of the sources
said on condition of anonymity. Another source expressed a
BOJ Governor Haruhiko Kuroda has recently been upbeat about
progress in escaping deflation and achieving his 2 percent price
target. But the BOJ has been notably wrong about exports.
The central bank has pushed back the expected timing of a
pickup in exports by several months in its assessments.
Receding geopolitical risks from Ukraine, rises in China's
May exports and a surge in U.S. imports - suggesting U.S.
consumers are buying more goods from emerging Asia - all added
to the central bank's optimism over the outlook for the global
This may prompt the BOJ to slightly improve its assessment
on overseas economies at a review during its two-day policy
meeting starting on Thursday, the sources said.
The assessment could be subject to change, however, as some
board members remain cautious about the overseas outlook largely
because of continued weakness in emerging Asian economies that
are among Japan's key export destinations.
Last month, the central bank said overseas economies, mainly
advanced nations, are "starting to recover, although lacklustre
performances are seen in some areas," suggesting that sluggish
emerging Asian growth remained a concern.
Despite the optimism on overseas growth, the BOJ is set to
maintain its assessment that exports are "more or less flat"
since there has been no clear signs of a pick-up.
Still, central bank officials hope improvements in overseas
economies will soon lead to increased exports, which have been
one of the few soft spots in an otherwise robust economy.
With domestic demand holding up, the BOJ is increasingly
confident that the economy is weathering a recent tax increase
and on on course to exit years of deflation.
(Additional reporting by Sumio Ito and Yoshifumi Takemoto;
Editing by William Mallard, Edmund Klamann and Simon