UPDATE 1-Global economy seems to have bottomed - Japan PM

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HUA HIN, Thailand, Oct 25 (Reuters) - The global economy has likely bottomed out but employment conditions are "dire" and stimulus is needed across Asia to spur domestic demand, Japan's prime minister said. "Prime Minister Hatoyama mentioned that at the moment the global economy is showing signs of recovery, mainly in Asia," Foreign Ministry spokesman Kazuo Kodama quoted Japanese Prime Minister Yukio Hatoyama as telling Asian leaders gathered for a summit meeting in the Thai resort town of Hua Hin on Sunday.

"The economic conditions of the global economy seem to have bottomed out, yet there is no room for complacency because the employment situation is still getting worse and in dire condition," he added.

He said Hatoyama shared a view expressed at the meeting by Asian Development Bank President Haruhiko Kuroda that Asian economies need to stimulate domestic demand along with regional demand to become less dependant on the U.S. market.

"Rebalancing of the sources of growth in Asia is a very important challenge," he said, quoting Hatoyama.

He said Hatoyama had emphasised the implementation of an exit strategy for withdrawing fiscal and monetary support would be premature.

The ADB's Kuroda shared Hatoyama's sentiments. "Indeed Kuroda also mentioned the timing of an exit strategy should be carefully examined," Kodama said. "He said 'It shouldn't be too late and shouldn't be too premature'".

The Japanese prime minister also urged a continued "fight against protectionism in all forms", Kodama added.

(Reporting by Jason Szep; Editing by Jeremy Laurence)