BOJ Nakamura:fund supply not panacea for deflation

FUKUOKA, Japan, Feb 4 (BestGrowthStock) – Bank of Japan policy board
member Seiji Nakamura said on Thursday increases in the central
bank’s liquidity provision alone will not help Japan escape
deflation.

“In order to solve demand shortages, it is important for the
BOJ, the government and private sector firms each to play their
own roles,” Nakamura told business leaders in Fukuoka,
southwestern Japan.

He said that to achieve sustained economic growth, the
government needs to review the special fiscal steps it has taken
in response to the global financial crisis and to consider
long-term fiscal reconstruction.

Nakamura, formerly a shipping firm executive, was among the
four dissenters when the BOJ cut rates to 0.3 percent in October
2008, calling instead for a cut to 0.25 percent.

The Democratic Party-led government has been calling on the
central bank to join it in efforts to fight deflation, as it
wants to avoid a return to recession ahead of mid-year elections.

Stock Market News

(Reporting by Rie Ishiguro)

BOJ Nakamura:fund supply not panacea for deflation