BOJ may suffer losses in event it exits easy policy, says governor Kuroda

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FILE PHOTO: A man wearing a protective mask walks past the headquarters of Bank of Japan amid the coronavirus disease (COVID-19) outbreak in Tokyo

TOKYO – The Bank of Japan could temporarily suffer losses on its huge asset holdings if it were to end its ultra-loose monetary policy, governor Haruhiko Kuroda said on Wednesday.

The BOJ holds huge amount of government bonds, which means reducing the size will take a long time if it decides to exit from ultra-easy policy in the future, Kuroda said.

“As the BOJ takes a long time adjusting its balance sheet, it could temporary suffer losses (on its balance sheet). We can’t rule out the chance. But we also cannot say for sure this will indeed happen,” he told parliament.

(Reporting by Leika Kihara; Editing by Muralikumar Anantharaman)