TOKYO: Bank of Japan Governor Haruhiko Kuroda said on Monday (Oct 5) uncertainty over the country’s economic and price outlook remained “very high” as the coronavirus pandemic continued to inflict pain on global growth.
Kuroda said the world’s third-largest economy was emerging from a severe downturn caused by the pandemic and was likely headed for a moderate recovery.
But he stressed the central bank was ready to maintain the range of measures put in place to ease corporate funding strains, and to top up monetary support if needed to cushion the economic blow from the health crisis.
“There is very high uncertainty on the economic and price outlook. Risks are skewed to the downside,” said Kuroda in a video message to an annual meeting of securities firms.
READ: Japan’s September service sector activity shrinks at slowest pace since COVID-19 pandemic’s start
While consumer prices will fall for the time being due to sliding oil prices and weak demand, they are expected to rebound as the economy emerges from the doldrums, he said.
“We will closely monitor the pandemic’s impact on the economy and markets, and won’t hesitate to take additional easing steps as needed,” Kuroda said.
Japan suffered its biggest economic slump on record in the second quarter as the pandemic and anti-virus measures crippled demand, and analysts expect any rebound to remain modest as fears of a second huge wave of infections weigh on consumption.
The BOJ expanded stimulus in March and April by ramping up asset buying and creating a new lending facility to ease corporate funding strains. It has kept policy steady since then.