Oct 31 (Reuters) - The Bank of Japan may be poised to cut
interest rates for the first time in seven years on Friday,
joining a wave of global interest rate cuts aimed at containing
the financial crisis.
It would be the BOJ's first rate cut since it started a
quantitative easing policy of flooding markets with cash in 2001.
Following are recent key comments by BOJ officials and
policymakers on the economy and the credit crisis:
PRIME MINISTER TARO ASO, Oct 30, news conference:
"A harsh storm seen only once in 100 years is raging ...
"Under such circumstances, I am certain that what is most
important is to remove uncertainties from the lives of the
people."
BOJ DEPUTY GOVERNOR KIYOHIKO NISHIMURA, Oct 29, parliament:
"There is a risk that global market and economic conditions
could worsen further and affect Japan's economy. Downside risks
for the economy are heightening.
"When financial market tension is high as it is now, the most
important contribution a central bank can make is to ensure
stability in markets through liquidity provision."
CHIEF CABINET SECRETARY TAKEO KAWAMURA, Oct 29, news
conference:
"The government is not in a position to give instructions to
the BOJ. But various expectations of it would arise in the course
of an exchange of opinions."
ECONOMICS MINISTER KAORU YOSANO, Oct 28, news conference:
"A rate cut to 0.25 percent from 0.5 percent would not affect
the economy at all, but there is a symbolic meaning to it.
"It would be an important proof of international cooperation
if Japan lowers rates when other central banks cut them."
BOJ DEPUTY GOVERNOR HIROHIDE YAMAGUCHI, Oct 27, news
conference:
"Japan's interest rates, at 0.5 percent, are very low in
light of Japan's economic growth and inflation ... Our basic
stance is to act flexibly by looking at both upside and downside
risks, in view of the outlook for the economy and prices.
"But global market developments are very tense, so we hope to
continue our efforts to ensure market stability through massive
liquidity provision."
FINANCE MINISTER SHOICHI NAKAGAWA, Oct 27, news conference:
(Asked whether Japan may intervene to stem yen rises)
"We must take steps if necessary as a matter of course, and
will decide what those steps would be by watching the market
moves and respond to them swiftly. But we haven't yet decided
what to do next."
BOJ SHIRAKAWA, Oct 17, meeting of credit unions:
"We must be mindful of how the recent global financial market
turmoil could, through worsening world economic conditions,
affect Japan's economy."
BOJ BOARD MEMBER ATSUSHI MIZUNO, Oct 19, newspaper interview:
Mizuno said Japan's economic growth will likely slow to 0.5
percent or lower in the current fiscal year ending in March,
below the BOJ's forecast of an 1.2 percent expansion made in
July.
He also said it was hard to forecast strong growth for the
next fiscal year beginning in April 2009.
BOJ SHIRAKAWA, Oct 15, parliament:
"Global financial markets are highly strained. The way the
central bank can contribute most in such a situation is to ensure
financial market stability. In this aspect, the BOJ will consider
various measures besides providing liquidity ...
"Japan's policy rate is very low and its financial system is
stable compared with other countries."
(Reporting by Leika Kihara)
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