TOKYO (Kyodo) -- The Bank of Japan on Thursday upgraded its economic view on two of the nation's nine regions, citing a continued recovery from a massive earthquake early last year and a pickup in the production of cars and electronic devices.

In its quarterly Sakura report, the central bank lifted the assessments of quake-hit Hokuriku in central Japan and the Tohoku region in the country's northeast, while the views on the seven other regions remained unchanged.

"The economy has been recovering moderately" although the Hokuriku region is still reeling from the impact of the magnitude 7.6 quake on Jan. 1, 2024 in Noto Peninsula, the report said.

Economic activities linked with the construction of buildings have been increasing steadily, and private consumption has been growing in the wake of a rise in inbound tourists, the central bank said.

The Tohoku region saw a rebound in vehicle production after an industry-wide vehicle certification scandal last year. Production of chip-manufacturing equipment and other electronic products also rose, driven by an artificial intelligence boom, according to the BOJ.

A BOJ official said at a briefing that companies are increasingly aware of the importance of wage increases.

"Due to a structural labor shortage and a rise in the minimum wage, companies in a wide range of industries, from small to large companies, share a view that sustained salary growth is necessary," the official said.

Among the companies the bank surveyed, a supermarket in Hokkaido said it plans the same level of pay rise for 2025 as last year, while a retailer in Akita Prefecture said it will implement salary increases under a medium-term management plan to retain talent.

BOJ Governor Kazuo Ueda said in December that he wants to see more data on whether the momentum of pay rises will be sustained in this year's labor-management talks before deciding on an additional rate hike. Japan saw an average wage increase of 5.1 percent in 2024, the largest rise in more than three decades, according to the Japanese Trade Union Confederation.

In a shift from a decade of ultra monetary easing, the central bank raised its key policy rate twice in 2024, including its first rate increase in 17 years in March.

Ueda has said it will increase rates further if the economy and prices continue to move in line with the bank's forecasts, although it also needs to monitor closely how the U.S. economy will be affected by the administration of President-elect Donald Trump.