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MNI (Beijing)
     TOKYO (MNI) - Bank of Japan Governor Haruhiko Kuroda said Thursday that the
BOJ made it clear its stance of conducting additional easy policy without
hesitation through the new forward guidance.
     "Judging from current economic and financial conditions, the BOJ would need
to maintain the easy policy beyond spring 2020 and the BOJ changed the forward
guidance," Kuroda said.
     "The BOJ stance of conducting easy policy doesn't retreat from the previous
stance," although the BOJ didn't conduct additional easing policy on Thursday,
Kuroda said.
     Earlier in the day, the BOJ board left policy unchanged, rejecting the
chance to buy some insurance and take preemptive policy action as it maintained
the view that the recovery was continuing as solid domestic demand continued to
underpin a recovery, even as downside risks remained.
     The BOJ did tweak its forward guidance, indicating that it will tolerate
policy rates moving below the current levels.
     "As for the policy rates, the BOJ expects short- and long-term interest
rates to remain at their present or lower levels as long as it is necessary to
pay close attention to the possibility that the momentum toward achieving the
price stability target will be lost," the BOJ said.
     The previous forward guidance was that the BOJ will maintain the current
easy policy "at least around spring 2020."
     Other key points from Kuroda's presser:
     --No further increase in the possibility of lost momentum toward achieving
the price stability target. BOJ must pay attention to the risk that the price
momentum will be lost given sustained slowdown in overseas economies.
     --The previous forward guidance was the BOJ maintains the easy policy
"until at least around spring 2020" and the BOJ needed to lengthen the period of
the forward guidance, judging from the heightened downside risks to the global
     --Kuroda also cited four policy tools as additional easy policies, such as
lowering the short- and long-term policy interest rates, expanding asset
purchases and accelerating the pace of injecting monetary base.
     --BOJ will consider additional easy policies though the BOJ board didn't
discuss additional easy policy.
     --The board members didn't discuss policy that the BOJ shortens the 10-year
interest policy rate to medium-term interest rate.
     --The June Tankan business sentiment survey and the branch managers'
meeting showed that domestic demand remains solid and the impact of the slowdown
in overseas economies on domestic demand is being limited.
     --Capital investment related to urban redevelopment projects, labor-saving
investment to address labor shortage and research and development investment for
growth areas, remain solid.
     --"Downside risk to overseas economies has heightened but its impact on
domestic demand is being limited," Kuroda said, adding the global recovery seems
to be delayed by about six months than expected.
     --Trade between the U.S. and China has somewhat improved, which have
positive impact on financial markets, but trade frictions will remain in the
long term. 
--MNI Tokyo Bureau; tel: +81 90-2175-0040; email:
--MNI Beijing Bureau; +86 10 8532 5998; email:

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