The Straits Times
www.straitstimes.com
Published on Nov 25, 2012
 

Japan PM, opposition chief clash over monetary policy

 
 

TOKYO (REUTERS) - Japanese Prime Minister Yoshihiko Noda said on Sunday that the opposition's call for radical monetary easing to beat chronic deflation was "dangerous" and defended the independence of the central bank, countering arguments by the front runner in next month's election.

Mr Noda and the leader of the Liberal Democratic Party (LDP), Mr Shinzo Abe, differed sharply over monetary and foreign policy in separate television appearances ahead of the Dec 16 election which the opposition party is tipped to win in opinion polls.

Mr Abe reiterated his call for setting a 2-per-cent inflation target, which is double the current goal of the Bank of Japan, to pull the world's third largest economy out of a long spell of deflation.

The LDP leader also called for revising the law governing the Bank of Japan (BOJ) so that the central bank is held responsible not only for price stability, but also for job creation and the health of the real economy.