Japan finance minister says no need to ask BoJ to delay rate decision |
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Published
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Tue, 16 Jan 2007 06:07
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TOKYO (XFN-ASIA) - Finance Minister Koji Omi said he sees no need for the government to ask the Bank of Japan to delay a decision this week on whether to raise interest rates.'We are not in a phase to exercise the right to call on the Bank of Japan to postpone a vote' at the central bank's monetary board meeting on Wednesday and Thursday, Omi told reporters.Weekend media reports said the central bank is likely to raise the benchmark rate of borrowing to 0.50 pct on Thursday from the current 0.25 pct.The BoJ raised interest rates to 0.25 pct in July last year when it ended its five-year policy of keeping borrowing costs at effectively zero in a bid to boost the economy.BoJ governor Toshihiko Fukui has made clear his desire to return to a more normal monetary policy.But government ministers are worried the central bank could repeat its blunder of August 2000 when it raised interest rates too soon and helped snuff out a nascent recovery.A senior official of Prime Minister Shinzo Abe's Liberal Democratic Party has called on the government to officially ask the central bank to postpone the planned rate hike.Under the Bank of Japan law, the government may ask the policy board to postpone a decision on monetary policy until the following meeting, a request which board members then vote on.si/dr/lh
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Japanese economy minister urges central bank to refrain from rate hike 