BoJ Deputy Governor Masayoshi Amamiya said the central bank is “ready to respond” financial crisis threatens the stability of the banking system.
He pointed to experience in the late 1980s, and noted “one of the factors that led to Japan’s asset-inflated bubble was the fact we kept monetary policy easy even as the economy continued to expand”. Hence, “the BOJ must be mindful of the potential risks to the economy and prices, including financial imbalances,”
Regarding monetary policy, Amamiya said “we’re ready to respond if financial problems have a big impact on the economy.”
