BoJ known dove Goushi Kataoka warned today coronavirus out break could hurt consumption and poses uncertainty to the economy. He called by stronger actions by the central bank. He said, “we need to be mindful that consumption may weaken further as a trend”, and, “worsening sentiment among automakers and retailers could also affect the outlook for capital expenditure.”
In his view, BoJ should deepen the negative interest rate further. Additionally, it’s “very important” for government and the central bank to coordinate their policies. He added, “I believe there’s room for the BOJ to review its policy framework and re-examine its effect including how it interacts with fiscal and pro-growth policies.”
Separately, Deputy Governor Masayoshi Amamiya said that with digital currencies, central banks could stifle private-sector financial innovation and draw money away from deposits at commercial banks. However, central banks must also conduct a “comprehensive study” on how digital currencies would affect their settlement and financial systems.