Bank of Japan discussed need for preemptive response to risks -July minutes

MACROECONOMICS - TOKYO. Bank of Japan policymakers discussed the need for the central bank to take a preemptive response to downside risks to the economy and prices, minutes of the central bank's July 29-30 meeting showed on Wednesday.

One member was quoted as saying that "there was a growing risk that the strengthening of the monetary easing stance by central banks in the United States and Europe would exert downward pressure on Japan's prices, mainly through foreign exchange rates. It was necessary to make a preventive and preemptive policy response to downside risks to prices."

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The BOJ left monetary policy steady at the July meeting but pledged to ease without hesitation to preempt risks that could hurt the chance of hitting its 2% inflation target.

At its subsequent policy review last week, the central bank stood pat but signalled the chance of expanding stimulus as early as its next policy meeting in October by issuing a stronger warning against overseas risks.