MNI POLICY: BOJ Policy Necessary, Sufficient: Gov Kuroda

     TOKYO (MNI) - The Bank of Japan has taken necessary and sufficient policy

measures now but will not hesitate to take additional easy policy if needed,

Governor Haruhiko Kuroda said Monday.

     "The BOJ will consider additional easy policy if economic activity and

prices weakened," Kuroda told reporters at a briefing following the

extraordinary policy meeting.

     The bank can deepen the short-term interest rate from -0.1% if needed, but

the focus now is on corporate financing, which has been hit by the coronavirus,

he added.

     Kuroda said that the BOJ needed to move up the regular policy-setting

meeting to quickly counteract volatile and unstable markets and tighter

corporate financing conditions.

     The BOJ board decided to enhance the easy policy, such as increasing the

scale of asset purchases and introducing new operation to support corporate

financing.

     Other points from Kuroda's remarks:

     --It is uncertain when the coronavirus outbreak will end, but the virus

will be a temporary phenomenon, and demand and production will pick up once it

wanes as infrastructure isn't damaged.

     --The virus is expanding around the globe with a time lag. The virus

appears to be moving toward an end in China, where the virus first appeared. 

     --Economic growth in China in Q1 is expected to be weak, but its economy is

likely to improve in Q2.

     --However, Kuroda was uncertain if the global economy would recover sharply

and he doesn't expect to see a big economic slump but low economic growth will

likely continue for a while.

     --Foreign exchange rates should move stably reflecting economic

fundamentals of each nation.

     --When asked about the drop in the Nikkei stock index, despite the BOJ's

easy policy, Kuroda said you should ask to market players if you want to ask

about market reaction. The Nikkei stock index ended at 17,002.04, down 429.01,

or 2.46%, from Friday's close.

     --The BOJ has pledged to inject ample liquidity regarding the yen and

dollar. He believes the policy decision will have effects.

     --Downward pressure from the sharp drop in crude oil prices will increase

but Japan's inflation rate will not fall into negative territory, Kuroda said.

--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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