MNI POLICY: BOJ Minutes: Uncertainty, But No Quick Easing Seen

     TOKYO (MNI) - Many Bank of Japan board members agreed to clarify that the

bank will patiently keep its current easy policy as uncertainties over the

outlook are high and it will still take time to achieve the 2% price target, the

minutes of the April 24-25 policy-setting meeting released Tuesday showed.

     Some members emphasized the need to make forward guidance on rates clearer

to strengthen public confidence in its policy. Many members of the Board didn't

see the need for additional policy action yet, although one dissenter saw the

need for immediate additional easing.

     A more up-to-date record of the BOJ's current outlook will be seen Friday,

when a summary of opinions from the June 19/20 meeting are published.

     The BOJ kept monetary policy unchanged in April, as Japan's economy was

still seen expanding moderately, despite persisting downside risks to both

activity and prices.

     But the BOJ clarified its forward guidance for policy rates, saying, "the

BOJ intends to maintain the current extremely low levels of short- and long-term

interest rates for an extended period of time, at least through around spring

2020, taking into account uncertainties regarding economic activity and prices

including developments in overseas economies and the effects of the scheduled

consumption tax hike."

     Other key points from the minutes:

     --One member said, "If the inflation momentum was lost, the BOJ should

flexibly and decisively conduct additional easing."

     --Another member said, "It was necessary to strengthen monetary easing at

this point toward achieving the 2% price target at the earliest possible time."

     --One member said that it is necessary to maintain the current easy policy,

paying more attention to the side effects. This member said, "it was important

that a policy mix of monetary and fiscal policies continue to be sustained."

     --One member said, "it was becoming increasingly necessary for the BOJ to

pay attention to the time frame in which monetary policy effects spread to the

real economy and to that in which their side effects strengthened in a

cumulative manner and cautiously weigh the positive effects and side effects."

--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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