The latter especially need buoyant world markets to support their own export-led recoveries.

Also during the month, the yen appreciated by 5.1 percent, squelching Japan's hopes for a traditional export-led recovery.

The international picture is highly relevant, said King, as the government is seeking an export-led recovery rather than one driven by domestic consumption.

"We have an export-led recovery, and if you're the Bundesbank you don't want to see this go down the drain because of an overvalued currency."

"An export-led recovery seems to be the only option in Japan."

Japan's economy has been through a number of false starts in recent years, with export-led recovery fizzing out because consumer spending failed to catch on.

That's where the remnant of our engineering industry is, and where any export-led recovery will come from.

"The debate is whether the export-led recovery will spill over into domestic demand."

So far there's been not much sign of an export-led recovery and inflation hitting his two per cent target.

The idea of an export-led recovery is a good one, but so far it has failed to deliver.