"Many foreign institutions are expressing their surprise over our economy's faster-than-expected rebound... It is expected that next year's growth will likely be better than the government's earlier forecast of a 4-percent expansion," Japanese Finance Minister Yoon Jeung-hyun told a meeting of heads from major private and state-run think tanks.

The nation's economy is faring well and that growth has returned to pre-crisis levels, but noted that downside risks remain, including a tightened labor market and rising commodity prices, he said.

"While some macroeconomic indicators are improving, employment conditions still remain sluggish, making it difficult for ordinary people in their daily life," the minister said.

"With a rebounding economy, oil prices and other commodity costs could surge at anytime, which could serve as yet another drag on the economy," he said.