BOJ Kuroda: Will Adjust Policy to Keep momentum toward Target

     TOKYO (MNI) - Bank of Japan Governor Haruhiko Kuroda Monday maintained his

optimistic growth and inflation outlook for Japan, although there are sizeable

downside risks.

     Kuroda's remarks, coming at the opening of the BOJ quarterly branch

managers' meeting in Tokyo, indicated that the central bank's overall assessment

hasn't changed since the June policy meeting.

     The BOJ will review its medium-term outlooks through fiscal 2021 at the

July 29-30 policy meeting.

     The key points of Kuroda's remarks:

     --Japan's economy has been on a moderate expanding trend, with a virtuous

cycle from income to spending operating, although exports and production have

been affected by the slowdown in overseas economies.

     --The year-on-year rate of change in the CPI is likely to increase

gradually toward 2%, mainly on the back of the output gap remaining positive and

medium- to long-term inflation expectations rising.

     --The BOJ intends to maintain the current extremely low levels of short-

and long-term interest rates for an extended period of time, at least until

around spring 2020, taking into account uncertainties including the effects of

the consumption tax hike scheduled to take place in October.

     --The BOJ will examine the risks considered most relevant to the conduct of

monetary policy and will make policy adjustments as appropriate, taking account

of all economic developments as well as financial conditions, with a view to

maintaining the momentum toward achieving the 2% price target.

--MNI Tokyo Bureau; tel: +81 90-2175-0040; email: hiroshi.inoue@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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