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TOKYO: Bank of Japan deputy governor Kiyohiko Nishimura said Thursday that the central bank should maintain its policy of raising interest rates gradually if the economy continues to recover from its long slump.
"Should the economy continue its gradual expansion under a stable price environment (as envisaged by the BoJ's official forecasts), we should maintain our basic policy stance," he told a parliamentary committee.
"But when there are strong uncertainties about the outlook, just like now, we should not prejudge anything," he added.
The central bank would "cautiously assess the feasibility of the standard economic outlook as well as both upside potential and downside risk," he said.
Nishimura is one of the two new deputy governors appointed this month at the BoJ.
The other deputy, Masaaki Shirakawa, was named acting chief last week after a political row prevented parliament from appointing a successor to Toshihiko Fukui, whose five-year term ended last Wednesday.
As governor, Fukui outlined a policy of raising interest rates gradually as the economy recovered.
He repeatedly warned of the risks of a very loose monetary policy, but political and economic uncertainty meant that the BoJ raised interest rates only twice during his tenure to 0.5 per cent, where they have been for more than a year. - AFP/ac
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