BOJ Members Called for Attention to U.S.-China Row: Minutes

December 26, 2018

Tokyo--Several Bank of Japan policymakers at their meeting in late October called for attention to U.S.-China trade friction, according to minutes of the meeting, released by the central bank on Wednesday.

Although the effects of the U.S.-China tensions on Japan's economy had been limited, "attention should be paid not only to the direct impact on Japan's trade activity but also to the possible effects through such indirect channels as the turmoil in global financial markets and the deterioration in business sentiment," some members of the BOJ's Policy Board said at the Oct. 30-31 meeting.

Many members shared the view that uncertainties over Japan's exports had heightened, with no sign of progress made in negotiations between the United States and China, according to the minutes.

Amid a global stock market rout that started early October, the BOJ decided at the meeting to lower its inflation forecasts for fiscal 2018 to fiscal 2020 while keeping its massive monetary easing unchanged.

On top of the prolonged trade friction between the world's two biggest economies, such factors as the risk of capital outflows from emerging economies, difficulties over negotiations on Britain's exit from the European Union and heightening geopolitical risks concerning Saudi Arabia had "led to a worsening of risk sentiment in the stock market," one member said. Jiji Press