JAPAN PRESS: BOJ Kuroda: Lowering Negative Rate One Option

     TOKYO (MNI) - Bank of Japan Governor Haruhiko Kuroda said that cutting

interest rates "further into the negative zone is always an option" for the BOJ,

according Japan's Nikkei.

     He also said that the central bank is growing increasingly concerned about

mounting downside risks to the global economy from the U.S.-China trade war. 

     He again noted that rate cuts are one of the four policy options the BOJ

has presented before.

     In its statement after July's policy board meeting, the BOJ had signalled a

willingness to consider preemptive easing if necessary. "The Bank will not

hesitate to take additional easing measures if there is a greater possibility

that the momentum toward achieving the price stability target will be lost," the

BOJ said.

     Kuroda suggested in the interview Thursday that circumstances have not

worsened enough to merit such steps at this point. He maintained a bullish

stance on Japan's economy, asserting that "we're maintaining momentum toward the

price stability target" of 2% inflation and that "domestic demand -- consumer

spending and capital investment -- are relatively firm."

     But he stressed that "caution is needed" in light of unpredictable

conditions overseas, particularly with regard to the trade war.

     While saying he considers it unlikely that the U.S. will enter a serious

recession, Kuroda noted a slowdown in the global economy, centred on Europe and

China.

     "I can't rule out the possibility that it will worsen further," Kuroda

said.

     "We're considering a variety of possibilities, including combinations of

these and improved versions," Kuroda added.

     The BOJ's two-day policy-setting meeting ending on Sept. 19 is scheduled

after the U.S. Federal Reserve releases the meeting results.

--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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