Oct 29 (Reuters) – The Bank of Japan on Thursday trimmed its economic and price forecasts for the current fiscal year, but offered a more upbeat view on the recovery outlook, signalling that it has delivered enough stimulus for the time being.
Following are comments from BOJ Governor Haruhiko Kuroda at his post-meeting news conference:
ECONOMIC OUTLOOK
“The outlook of Japan’s economy remains highly uncertain and bound with downside risks. Some countries are reimposing lock-down measures, so the situation remains uncertain … Markets remain jittery, so we need to monitor developments carefully. We will maintain our monetary-easing steps … and won’t hesitate to take additional measures as needed.”
CRISIS-RESPONSE PROGRAMME DEADLINE
“There’s no change to our stance of being open to extend the March 2021 deadline for the crisis-response programme, depending on future developments regarding the pandemic. We will extend the deadline, if we deem it necessary and appropriate.”
RESURGENCE OF COVID-19 CASES
“While we are seeing a resurgence in COVID-19 infections, the U.S. economy is recovering pretty well. Some European countries are re-imposing lockdown measures, but are done in a targeted way that seeks to keep economic activity open and prevent the spread of the virus.”
COVID-19 IMPACT ON EMERGING ECONOMIES
“While countries such as China and other advanced economies have ample fiscal and monetary scope, that may not be the case for some emerging economies, so we need to watch developments carefully. I still don’t think we’ll see a repeat of what happened during the Lehman crisis and the Asian financial crisis.”
BOJ PURCHASE OF EXCHANGE-TRADED FUNDS
“If the economy and markets stabilise, we will discuss an exit. But this operation is part of our policy framework. As of now, our ETF buying continues to be an important part of our monetary policy framework.”
JAPAN’S FINANCIAL SYSTEM RISK
“For now, the risk (of a financial system destabilisation) isn’t big due to the bold measures taken by the government and BOJ. But we will carefully monitor the impact of the pandemic on Japan’s financial system without any preconception. We’re ready to respond to various scenarios under close coordination with the Financial Services Agency.”
ON SUPER-LONG BOND BUYING
“In our comprehensive review conducted in 2016, we concluded that an excessive decline in super-long bond yields could indirectly hurt consumer confidence … But we’re not thinking of discontinuing purchases of super-long bonds, or review the way we conduct our bond-buying operations under the Yield Curve Control framework.”
NO IMMEDIATE CHANGES TO CRISIS-RESPONSE PROGRAMME
“We’ll look into details. But at this stage, we are not thinking about making any specific changes to the content of the crisis-response programme.” (Reporting by Leika Kihara; Editing by Sherry Jacob-Phillips)
HIGHLIGHTS-BOJ Governor Kuroda’s comments at news conference
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Oct 29 (Reuters) – The Bank of Japan on Thursday trimmed its economic and price forecasts for the current fiscal year, but offered a more upbeat view on the recovery outlook, signalling that it has delivered enough stimulus for the time being.
Following are comments from BOJ Governor Haruhiko Kuroda at his post-meeting news conference:
ECONOMIC OUTLOOK
“The outlook of Japan’s economy remains highly uncertain and bound with downside risks. Some countries are reimposing lock-down measures, so the situation remains uncertain … Markets remain jittery, so we need to monitor developments carefully. We will maintain our monetary-easing steps … and won’t hesitate to take additional measures as needed.”
CRISIS-RESPONSE PROGRAMME DEADLINE
“There’s no change to our stance of being open to extend the March 2021 deadline for the crisis-response programme, depending on future developments regarding the pandemic. We will extend the deadline, if we deem it necessary and appropriate.”
RESURGENCE OF COVID-19 CASES
“While we are seeing a resurgence in COVID-19 infections, the U.S. economy is recovering pretty well. Some European countries are re-imposing lockdown measures, but are done in a targeted way that seeks to keep economic activity open and prevent the spread of the virus.”
COVID-19 IMPACT ON EMERGING ECONOMIES
“While countries such as China and other advanced economies have ample fiscal and monetary scope, that may not be the case for some emerging economies, so we need to watch developments carefully. I still don’t think we’ll see a repeat of what happened during the Lehman crisis and the Asian financial crisis.”
BOJ PURCHASE OF EXCHANGE-TRADED FUNDS
“If the economy and markets stabilise, we will discuss an exit. But this operation is part of our policy framework. As of now, our ETF buying continues to be an important part of our monetary policy framework.”
JAPAN’S FINANCIAL SYSTEM RISK
“For now, the risk (of a financial system destabilisation) isn’t big due to the bold measures taken by the government and BOJ. But we will carefully monitor the impact of the pandemic on Japan’s financial system without any preconception. We’re ready to respond to various scenarios under close coordination with the Financial Services Agency.”
ON SUPER-LONG BOND BUYING
“In our comprehensive review conducted in 2016, we concluded that an excessive decline in super-long bond yields could indirectly hurt consumer confidence … But we’re not thinking of discontinuing purchases of super-long bonds, or review the way we conduct our bond-buying operations under the Yield Curve Control framework.”
NO IMMEDIATE CHANGES TO CRISIS-RESPONSE PROGRAMME
“We’ll look into details. But at this stage, we are not thinking about making any specific changes to the content of the crisis-response programme.” (Reporting by Leika Kihara; Editing by Sherry Jacob-Phillips)
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