TOKYO, Dec 19 (Reuters) - The Bank of Japan is expected to weigh various options including a rate cut on Friday as the Japanese economy is seen trapped in a lengthy recession.
Following are recent key comments by BOJ and Japanese government officials on the economy:
TAKEO KAWAMURA, Dec 18
"The BOJ has been acting appropriately while examining economic and market conditions. I'm sure it will continue to do so. Prime Minister Aso last week expressed his view that he hopes the BOJ would provide ample funds. That's the government stance."
FINANCE MINISTER SHOICHI NAKAGAWA, Dec 18
"If the BOJ shares the government's view on the financial situation, I expect the bank to take whatever steps are necessary."
ECONOMICS MINISTER KAORU YOSANO, Dec 18
"(Even if the BOJ cuts rates from 0.30 percent) the maximum reduction in interest rates would be 0.30 percentage point, which would not have a significant impact on corporate finance nor capital spendings."
BOJ GOVERNOR MASAAKI SHIRAKAWA, Dec 16
"The economy is increasingly stagnating."
"The December tankan results clearly showed severe economic conditions, in terms of companies' sentiment and their capital spending plans."
"The accommodativeness in Japanese monetary conditions is retreating rapidly."
"In our economic outlook report in October, we said as our main scenario that the economy would bottom out in the latter half of 2008/09. As we've said, there are downside risks to this view. We will have to revise down our previous view.
"Basically, while the central bank provides liquidity, the government takes care of (financial institutions') losses or capital.
"But when economic and financial conditions are severe, there is not necessarily a clear line dividing liquidity and credit risks. In that sense, we are not totally ruling out taking on (credit) risks.
PRIME MINISTER TARO ASO, Dec 12
Aso said he hoped Bank of Japan would take measures to provide ample liquidity to financial markets.
BOJ DEPUTY GOVERNOR HIROHIDE YAMAGUCHI, Dec 11
"As for future policy measures, we hope to examine various measures without preconceptions."
SHIRAKAWA, Dec 2, after measures to help corporate finance
"These measures alone cannot determine the shape of the economy but they will have an effect in improving corporate finance, which has been worsening."
"Increasing strains in global financial markets have affected Japan's financial markets as seen in big fluctuations in share prices and the widening of credit spreads in corporate bond markets.
"Thanks to effects from our efforts in financial adjustments, Japan's financial markets remain relatively stable compared to the West.
"But when we look at Japan's financial environment, overall corporate financing conditions are becoming less accommodative."
"With regard to the possibility of a further cut in interest rates, we've said we should be aware that very low interest rates could harm the functioning of money markets." (Reporting by Hideyuki Sano)