BUSINESS Japanese gov't says to closely work with BOJ amid market turmoil


Japanese gov't says to closely work with BOJ amid market turmoil


20:36, March 17, 2023

TOKYO, March 17 (Xinhua) -- Japanese government will work closely with the country's central bank to guarantee an appropriate response to recent market volatility as a result of worries about U.S. and European banks, said a senior official from the Finance Ministry on Friday.

This picture taken on February 27, 2023 shows tourists sitting on a bench under a Kawazu cherry blossom tree, one of the earliest blooming cherry blossoms in Japan, in the city of Miura, Kanagawa Prefecture. (Photo: AFP)

After a meeting between Finance Ministry officials, the Bank of Japan and the Financial Services Agency, Masato Kanda, vice finance minister for international affairs, said the Japanese banking system is "stable as a whole," local media reported.

"Keeping in mind that there are various risks, the government will coordinate closely with the BOJ and the authorities of other nations to monitor economic and financial market developments at home and abroad. We will continue to analyze their impact on the Japanese economy with a heightened sense of vigilance," Kanda was quoted by Kyodo News as saying.

The meeting took place just before the BOJ changes its leadership. New deputy governors will take office on Monday for five years, and academic Kazuo Ueda will take over as the Governor on April 9.

"Even in the transitional phase, it's important that the government and the BOJ ensure we coordinate seamlessly and take necessary steps," the Finance Ministry official said.

The collapse of Silicon Valley Bank and Signature Bank in the United States has raised fears and shocked financial markets. Credit Suisse, the second-largest Swiss banking group, has secured an emergency loan from the country's central bank.

Japanese Prime Minister Fumio Kishida told a press conference later Friday that Japanese financial institutions "have remained relatively stable" as domestic banks have "adequate liquidity and capital."

Market watchers here warned that as Japan can neither take lightly nor stay out of the financial turmoil triggered by aggressive interest rate hikes in the United States and Europe, the BOJ should be more cautious when seeking a way out of its ultra-loose monetary policy.

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