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TOKYO (MNI) - The Bank of Japan needs to re-examine the impact of monetary
policy and to review its framework, board member Goushi Kataoka said Thursday.
"I judge that the momentum toward achieving the 2% price stability target
is lost. It's appropriate to take policy (action) in order to boost the output
gap and inflation expectations," Kataoka told business leaders in Otsu City.
However, he didn't elaborate on when or how the BOJ would re-examine its
policy impact and framework.
The BOJ's next policy-setting meeting is scheduled for March 18-19.
Other key points from Kataoka's speech:
--Japan's private consumption, capital investment and exports will all
likely fall temporarily, but on average are expected to gradually pick up.
--Kataoka, however, warned of large downside risks, and the BOJ must
carefully eye the outlook for Japan's economy.
--If it takes time to contain the coronavirus, there is the risk that
downward pressure on spending will increase as consumer sentiment takes a hit
and travel falls.
--Japan's exports will unlikely pick up significantly as the global
recovery still looks fragile.
--With the uncertainty over how long the coronavirus outbreak lasts, and
how it affects domestic and overseas economies, the BOJ must carefully assess
the timing of the recovery without any preconceptions.
--The BOJ must keep a close eye on downward pressure from the coronavirus
on the Chinese economy.
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