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MNI (London)
     TOKYO (MNI) - Bank of Japan Deputy Governor Masazumi Wakatabe said Monday
that benefits and costs of easy policy will change with the passage of time and
the BOJ must watch for accumulative effects of easy policy.
     Wakatabe told lawmakers that benefits of the easy policy are exceeding
their costs, but prolonged easy policy will put further downward pressure on
profits at financial institutions, and the BOJ must watch accumulative impact of
easy policy.
     He also said that the BOJ's "yield curve policy" is aimed at boosting
inflation expectations and not flattening the yield curve.
     "The BOJ needs to patiently maintain easy policy ,not only to beat
deflation but also to boost inflation expectations. When inflation expectations
rise, the yield curve steepens" and that will be favorable for banks, Wakatabe
     Wakatabe, 53, has previously said that the BOJ "without hesitation" should
conduct additional easy policy if necessary to achieve the 2% target. A former
economics professor, the renowned reflationist who has advocated bold monetary
easing to overcome deflation took office on March 20.
--MNI Tokyo Bureau; tel: +81 90-2175-0040; email:
--MNI London Bureau; tel: +44 203-586-2225; email:
MNI London Bureau | +44 203-865-3812 |
MNI London Bureau | +44 203-865-3812 |

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