“It is often argued that there is a limit to monetary easing, but I do not share such a view”, Kuroda said in a speech in Tokyo, adding, “Needless to say, there is still ample room for further cuts in the negative interest rate and for an increase in the quantity dimension”.
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Asian stock markets rallied Monday and the dollar dipped after a slowdown in U.S. job creation dimmed expectations of an interest rate rise this month but also showed the economy still improving. Asian stocks rose Monday as a U.S.jobs report set off hopes among traders that the Federal Reserve will wait before raising int.
In early European trade London rose 0.1 percent, Frankfurt gained 0.3 percent and Paris put on 0.2 percent.
Meanwhile, the benchmark Nikkei 225 closed up 0.26 percent at 17,081.98 and the broader Topix index also closed 0.65 percent higher to 1,352.58 points.
On the Chinese economy, however, Kuroda said that for his and the bank’s part, there was no sense of pessimism regarding the world’s second-largest economy, and, unlike Japan’s own economic situation, China’s economy facing similar stagnation was highly unlikely. Friday’s U.S. jobs report showed nonfarm payrolls rose by 151,000 jobs in August after an upwardly revised 275,000 increase in July.
Apart from this, according to recent Reuters poll, 60 percent of economists see the Bank of Japan easing in September 21; 40 percent see them stay unchanged.
The Reserve Bank of Australia is expected to keep interest rates on hold at the meeting, the last to be chaired by long-standing governor Glenn Stevens before he retires this month.
Saudi energy minister Khalid al-Falih will make a “significant announcement” at a news conference at 0930 GMT at the G20 summit now being held in Hangzhou in China.
Markets are now pricing in just over a 1 in 5 chance that US rates will be incresed in September, and a just over 50 percent chance that they will be hiked by the end of the year – down from around a 55 percent chance priced in last week before the jobs data, according to CME FedWatch.
Japan’s economy hasn’t deteriorated much since the July easing and the government’s fiscal spending package will start to boost growth, offering few reasons to expand monetary stimulus now, he said.
The euro rose 0.1% to $1.1164 ahead of Thursday’s European Central Bank (ECB) interest rate decision.
But the governor also said it is important to take into account the impact that the negative interest rate policy might have on the financial system.
Richmond Federal Reserve Bank President Jeffrey Lacker said on Friday that the USA economy appears strong enough to warrant significantly higher interest rates.
Brent crude was down 0.6 per cent at $46.53 a barrel while USA crude slipped 0.7 per cent to $44.13. Brent crude, the benchmark for worldwide oil prices, rose 3 cents to $46.86 a barrel.
Both had gained 3% in the previous session as the dollar slipped after the employment data, making oil cheaper for investors holding other currencies.
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But for the week, Brent fell 6 per cent, its biggest drop in five weeks, while U.S. crude fell almost 7 per cent to mark its largest decline in eight weeks.
