MNI POLICY: BOJ Kuroda: To Mull More Easing If Need For Target

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

BOJ will consider conducting additional easy policy if hitting the 2% price

target is undermined by a slowing economy and inflation triggered by exchange

rate moves.

     Kuroda told lawmakers, "A central bank's monetary policy isn't directly

linked to foreign exchange rates, but central banks are closely watching the

impact of foreign exchange rate movements on economic activity and prices."

     He added that if the yen rose due to a narrowing interest rate gap between

the U.S. and Japan because the U.S. Federal Reserve cut rates, it will affect

Japan's wider economy.

     "The BOJ will consider conducting additional easy policy," if the

achievement of the 2% price is undermined due to developments of foreign

exchange rate, Kuroda said.

     As for possible measures, Kuroda pointed out four tools, including lowering

the short- and long-term interest rates, expanding the asset purchases and

accelerating injections into the monetary base.

     But he also said, "We will carefully examine the pros and cons" of

additional easing and the BOJ will carefully decide on its tool in a balanced

manner, taking all benefits and costs into consideration.

--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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