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MNI (London)
     TOKYO (MNI) - Bank of Japan Governor Haruhiko Kuroda Thursday warned of
climate-related risks to the economy, which he sees as differing from other
issues faced by policymakers.
     "It is necessary to keep in mind to what extend industrial policies and
environmental regulations and guidelines are effective in addressing such risk,"
Kuroda told the Europlace Financial Forum in Tokyo.
     "Therefore, there may be room in this case for cooperation between the
industrial sector and the financial sector," Kuroda said.
     "Climate-related risk raises cross-sectional and time-dimensional issues.
The cross-sectional problem is that carbon emissions affect a wide range of
industries, and the time-dimensional problem is that this affect is a long-term
problem," Kuroda noted.
     In addressing environmental risks as a new issue in financial stability,
the wealth of previous discussions between financial regulators and supervision
may provide some valuable insights, Kuroda said.
     Kuroda didn't mention monetary policy in his speech, but touched on the
outlook in a question and answer session, indicating that the BOJ will maintain
the current easy policy to prevent short- and long-term interest rates from
rising due to a possible increase in JGB issuance.
     "The government is considering compiling a supplementary budget not only to
improve social infrastructure (damaged by natural disasters) but only to
mitigate negative impact of the slowdown in overseas economies on Japan's
economy," Kuroda said.
     "The yield curve control is aimed at lowering short- and long-term interest
rates, which also strengthen the impact of fiscal policy. Fiscal policy will
increase government bond issuance and push up long-term interest rates," he
said, adding, "Policy coordination or policy mix is a standard policy to cope
with current economic conditions."
--MNI Tokyo Bureau; tel: +81 90-2175-0040; email:
--MNI London Bureau; tel: +44 203-586-2225; email:
[TOPICS: MMJBJ$,M$A$$$,M$J$$$]
MNI London Bureau | +44 203-865-3812 |
MNI London Bureau | +44 203-865-3812 |

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