* BOJ seeking ways out of crisis steps - analyst
* BOJ scrapping 3-month dollar fund supplies
* Slide in corporate service prices speeds up (Adds details)
By Tetsushi Kajimoto
TOKYO, Sept 25 (Reuters) - A few Bank of Japan board members said the bank must make it clear to markets that ending its corporate support would not signal a change of direction in monetary policy, minutes of the board's August meeting showed.
The minutes add to recent signals from the BOJ that it may start phasing out support for corporate finance from December.
"The minutes show that the central bank is seeking ways out of its crisis measures," said Seiji Shiraishi, chief economist at HSBC Securities Japan.
"That doesn't mean it would lead to a rate hike anytime soon given the fragile economic recovery, but the BOJ may be trying to act in line with other central banks as the Federal Reserve is taking a step towards scaling back its balance sheet."
International financial markets have been stabilising, leading major central banks to announce on Thursday that they planned to scale back massive injections of U.S. dollars into their banking systems.
Still, analysts said this should not be seen as a move to begin withdrawing monetary policy stimulus from economies that remain fragile.
The BOJ will shorten the duration of its dollar funding operations, effectively scrapping three-month fund supplies. From October, the longest dollar funding operation will be 10 weeks, a move seen as reflecting dwindling demand from banks for long-term dollar liquidity.
Last week, the BOJ raised its assessment of the economy and financial conditions due to improvements in exports and output, signalling that the country is ready to pull out of crisis mode as it emerges from its deepest postwar recession.
Japanese Strategy Minister Naoto Kan said on Friday that it is too early for officials to let down their guard on the economy because the labour market remains weak despite an improvement in exports.
Kan, who is also the deputy prime minister, added that there is no gap between the government's and the BOJ's assessment of the economy. The government will cooperate with the central bank by offering its views at monetary policy meetings, Kan said.
Under the BOJ law, representatives of the Cabinet Office and Ministry of Finance can attend BOJ meetings. Government representatives cannot vote on policy but they can voice opinions and request delays in votes.
A few BOJ board members said at the August meeting that issuance rates on some commercial paper had fallen below yields on government debt, but many noted that improvements in financial conditions were limited for small firms and companies with low credit ratings.
At the meeting, the BOJ stuck to its cautious view on the economy, after voting in July to extend its measures aimed at easing credit strains by three months to the end of December.
In Japan, record deflation, rising job losses and weak capital spending all look set to cloud the debate on the timing of the BOJ's exit from the corporate finance market.
In another sign of deepening deflation, Japanese corporate services prices fell 3.5 percent in August from a year earlier, with the pace of fall widening for the fifth straight month.
Analysts said corporate cost-cutting, including labour costs, was partly to blame for a sharper fall in business-to-business service prices due to weak demand, which will in turn curb consumption and add to downward pressure on prices.
At the August meeting, a few of the eight central bank board members said commercial banks' reduced reliance on BOJ fund operations showed markets were improving. But one said the bank should continue to supply ample liquidity while paying heed to market functions.
The BOJ has kept interest rates at 0.1 percent since cutting them twice late last year as the financial meltdown pushed the world economy into recession. Investors expect the bank to keep rates steady at least until 2011. (Additional reporting by Hideyuki Sano, Rie Ishiguro, Stanley White and Mark Felsenthal; Editing by Hugh Lawson and Chris Gallagher)