WASHINGTON, Oct 20 (Reuters) - Bank of Japan Governor Haruhiko Kuroda said on Sunday a mix of monetary easing, flexible fiscal spending and structural reforms to raise the country’s long-term growth potential could be effective in stimulating the economy.
Kuroda also said BOJ will take steps to reduce the cost of prolonged monetary easing.
“Financial system stability should be addressed primarily through macro-prudential steps. But no prudential tool-kit is perfect,” Kuroda told a seminar on central banking.
“Monetary policy influences broad areas of financial activity. The BOJ should examine financial functioning and make appropriate policy responses, so that the cost of monetary easing is reduced.” (Reporting by Leika Kihara; Editing by Lisa Shumaker)