MNI POLICY: BOJ Kuroda Warns Of Corp Funding Strains

Bank of Japan Governor Haruhiko Kuroda warned on Thursday that companies continue to face funding strains despite the central bank's supportive measures.

"Financial conditions have been accommodative on the whole but severity is observed in corporate financing," Kuroda said as he opened the quarterly branch managers' meeting.

The Governor's view is at odds with the BOJ's September Tankan survey, which showed an improvement in corporate financing and the willingness of banks to lend.

MONETARY POLICY

Kuroda said the BOJ continues to facilitate corporate financing and maintain the stability of the financial system.

He said the BOJ will closely monitor the impact of the coronavirus and will not hesitate to take additional easing measures, if necessary. The Bank also expects short and long-term policy interest rates to remain at current or lower levels.

Although economic activity in Japan has resumed gradually, the outlook remains at risk due to the pandemic

"Japan's economy is likely to follow an improving trend," Kuroda said. However, "the pace of improvement is expected to be only moderate while the impact of Covid-19 remains worldwide," he added.

Japan's inflation rate has fallen in recent months, dipping into negative territory and is expected to stay there for some time.

The BOJ will release its quarterly regional economic report based on assessments by the branch managers at 1400 JST (0500 GMT).