Japan PM sees "big problem" from country's stocks swings

BEIJING (Reuters) - Japanese Prime Minister Taro Aso said on Friday the rapid fluctuation in the country's stock prices posed a "big problem," adding that the global financial crisis stems from a lack of trust between investors and governments.

Speaking to reporters while attending the two-day Asia-Europe Meeting (ASEM) of 27 EU member states and 16 Asian countries in Beijing, Aso said market declines were caused in part by global uncertainties over when U.S. housing prices would hit bottom.

U.S. credit woes caused by waves of bad mortgages have spread to a global crisis of confidence among lenders and worsened the impact of an economic slowdown.

"Rather rapid fluctuations in share prices is a big problem," Aso said.

But the Japanese prime minister also said Japan has benefited recently from the rapid rise of the yen against the U.S. dollar, noting that it has pushed down the relative price of oil, which is denominated in dollars.

"If the yen rises, it will push down oil prices (in Japan)," Aso told reporters.

The Nikkei slid to a 5- year closing low on Friday, bringing the fall for the year to 50 percent, hit by the double punch of a Sony Corp profit warning and a surge in the yen.

The Japanese currency hit 13-year highs against the dollar in Asian trading hours, while the euro dropped more than 6 percent to a six year trough.

(Reporting by Yoko Nishikawa; Editing by Ken Wills)