It would be “dangerous” for the Bank of Japan to increase stimulus beyond what it already planned before Prime Minister Shinzo Abe implements structural reforms in the economy, a top International Monetary Fund official said.
Greece’s deepening financial crisis serves as a lesson for Japan, which needs to devise a “credible” fiscal plan to curtail the world’s largest public debt, an International Monetary Fund official said.
The Bank of Japan may need to provide more monetary stimulus if power shortages, supply chain disruptions and the nuclear crisis after the quake are prolonged, the International Monetary Fund’s No. 3 official said.
The International Monetary Fund is discussing the criteria for adding currencies to its Special Drawing Rights valuation basket made up of the dollar, euro, yen and pound, its number-three official said.
Europe has yet to allay investor “skepticism” about the sustainability of the region’s debt, and any spread of the crisis would cloud the global economic outlook, the International Monetary Fund’s No. 3 official said.
Japanese shares fell, with the Topix index erasing earlier gains, as data showed China’s manufacturing unexpectedly contracted, countering an advance by electronics shares including NEC Corp. and Nidec Corp.