TOKYO: Bank of Japan Governor Masaaki Shirakawa said on Monday he was continuing to watch the risk of Europe's debt woes affecting Japan's banking system, although worries about major market turmoil have subsided.
"Japan's financial system has maintained stability as a whole, but close watch is still needed on risk factors such as a spillover from Europe's situation," Shirakawa said in a speech at an event hosted by the Trust Companies Association of Japan.
The BoJ surprised markets in February by boosting its target for asset purchases by double the usual increment and setting a 1 percent inflation goal, signalling a more aggressive policy to beat deflation, which has plagued the economy for nearly two decades.
The central bank has kept monetary policy steady since then but will consider easing at its next rate review on April 27 by boosting asset purchases, sources say.
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