Japan indicates monetary policy shift

MAEBASHI, Japan - Bank of Japan policy board member Hidehiko Haru said today the chances of the central bank shifting its ultra-easy monetary policy would increase around the fiscal year starting in April.

Haru, whose policy stance is considered neutral compared with the rest of the nine-member board, also reiterated the BOJ's position that any shift entailing a lowering in the central bank's target for excess money in the banking system would be gradual.

"Having continued quantitative easing for a long time, since March 2001, we need to lower the balance of current account deposits carefully while monitoring financial markets closely," Haru told business leaders in Maebashi, north of Tokyo.

Markets expect the BOJ to scrap its ultra-easy monetary policy in the first half of next year as the economy shakes off seven years of deflation.

- REUTERS