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Japan government to work with BOJ to revive economy

TOKYO (Reuters) - Japan's top government spokesman said on Wednesday the government will continue to work with the Bank of Japan to beat deflation and revive the economy.

The Japanese economy is expected to continue a moderate pickup but the government remains on alert against risks stemming from Europe's sovereign debt crisis, Fujimura told a news conference.

The central bank kept monetary policy on hold in a meeting that ended on Tuesday, rejecting a proposal by one of its board members for more stimulus and disappointing some in markets who thought the central bank could follow up last month's easing with another move to amplify its impact.

(Reporting by Tetsushi Kajimoto; Editing by Michael Watson)