Prime Minister Junichiro Koizumi said Wednesday he expects the Bank of Japan to implement monetary policies that can be “effective in terms of both quality and quantity.”
His remarks, made at a House of Councilors plenary session, effectively put pressure the BOJ to relax its credit grip ahead of the Oct. 30 meeting of the BOJ Policy Board.
Similar pressure was put on the BOJ by a senior U.S. Treasury Department official on Tuesday.
“The efforts of the Bank of Japan to raise the monetary base are in the right direction for ending deflation, but they need to be continued,” said John Taylor, U.S. Treasury undersecretary for international affairs, urging the BOJ to maintain a steady growth rate in the money supply.
Last week, BOJ Gov. Masaru Hayami said he saw no immediate need to further ease the central bank’s credit grip, although he reiterated that the BOJ will relax its monetary policy further if necessary.
The BOJ Policy Board voted unanimously to leave its current ultra-easy monetary policy intact at a meeting Oct. 11.