No change to dollar's key fx status: Shirakawa

"It takes a very long time for the world's key currency to change, as was the case when it shifted to the US dollar from the British pound," Shirakawa said in an interview with the Mainichi paper conducted on Friday and published on Saturday.

"The US economy is the world's biggest and the market for dollars is the world's most liquid. Everyone uses (the dollar) and I don't think the current situation will change immediately," he said.

The dollar has fallen broadly, particularly against safe haven currencies like the yen and the Swiss franc, on S&P's downgrade of the US credit rating last week and worries about the health of the US economy.

Shirakawa also said the Japanese central bank's monetary easing last week was a pre-emptive move to counter the potential harm recent yen rises could have on Japan's economy, and that he preferred to assess its effect on the economy for now.

But he also reiterated that the BoJ will take appropriate action based on economic conditions at the time, signalling the bank's readiness to ease policy again if further yen rises hurt Japan's growth prospects, the paper said.

Japan intervened in the currency market and the BoJ eased policy last week in an effort to stem the yen's rise -- which had taken the currency near record highs -- from derailing Japan's recovery from the devastation of the March earthquake and tsunami.

Copyright Reuters, 2011