UPDATE 3-Japan’s Noda says ready to use all measures on yen

* Finmin says BOJ could do more through monetary policy

* Echoes PM’s pledge to act decisively on yen when needed

* Says told China he wants steady progress on yuan reform

(Adds comments about Japan seeking yuan reform)

By Tetsushi Kajimoto

BEIJING, Aug 28 (BestGrowthStock) – Japanese Finance Minister
Yoshihiko Noda said on Saturday he was ready to employ “all
possible measures” to tackle the soaring yen, which was having a
big impact on the country’s export-led economy.

Speaking in China’s capital, Noda told reporters he wanted
the Bank of Japan to guide policy while sharing its views on the
economy with the government.

He also said there was room for Japan’s central bank to
improve the monetary situation, but it was up to the bank to
consider specific policy steps.

The yen hit a 15-year high against the dollar this week, and
Tokyo is scrambling to craft a package of steps to prop up its
stuttering economy while keeping up pressure on the BOJ to do
more to pull the country out of deflation.

The yen, which surged to 83.58 per dollar on Tuesday, was
hovering just above 85 on Saturday.

“Many people are worried and the government is taking a
serious view, and we must adopt all possible measures,” Noda
said, after meeting Chinese Finance Minister Xie Xuren on the
sidelines of a Japan-China economic dialogue.

Noda urged China to make its yuan currency more flexible and
said Japan would announce its basic policy on an economic
package next week.

“We will take decisive measures when necessary while
watching market trends with great interest,” Noda said, echoing
comments the previous day from Prime Minister Naoto Kan that
signalled possible currency intervention.

Noda also said he expected Kan to meet BOJ Governor Masaaki
Shirakawa as soon as possible after the central bank chief
returns from the United States on Monday.

The BOJ may hold an emergency meeting early next week to
ease monetary policy, a source familiar with the matter said

China, meanwhile, should continue making “steady efforts” to
make its currency more flexible, Noda told reporters. The yuan
has appreciated about 0.4 percent against the dollar since it
was lifted from a nearly two-year peg on June 19. [CNY/]

Japan has not intervened in the currency market since March
2004, when a 15-month yen-selling spree came to an end. During
that period, they sold 35 trillion yen ($410 billion), the
equivalent of more than one-third of the annual budget.

Despite the risk of possible action by Japanese authorities
to curb yen strength, such as currency intervention or monetary
easing, some traders and investors say the yen could still test
a record high of 79.75 yen to the dollar, hit in April 1995.

($1=85.37 Yen)

(Reporting by Tetsushi Kajimoto; Editing by Nick Macfie, Ken
Wills, John Stonestreet)

UPDATE 3-Japan’s Noda says ready to use all measures on yen