Japanese prime minister Yoshihiko Noda plans a new round of economic stimulus by the end of next month as the country has entered a lull, Kyodo News reported, quoting sources close to the prime minister.

The steps are expected to include measures to curb deflation, ease strength in the yen, expand earthquake reconstruction work and relax regulations on businesses, the news agency reported.

The Japanese government has downgraded its outlook for the economy three times in a row in its monthly assessment, saying last week there was a weak tone.

The Nikkei newspaper said the Japanese government was considering funding the new stimulus with 910 billion yen (€8.8 billion) set aside in the 2012 budget for economic emergencies and the revitalisation of regional economies.

– (Reuters)