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Japan Housing Starts Decline Sharply In November
By RTTNews Staff Writer
Japan's housing starts logged a double-digit decline in November, data from the Ministry of Land, Infrastructure, Transport and Tourism showed on Thursday.

Housing starts decreased 12.7 percent on a yearly basis, following a 7.4 percent drop in October. This was the fifth consecutive decrease in housing starts. Economists had forecast an 8.1 percent fall.

Annualized housing starts decreased to 834,000 in November from 879,000 in October. The expected level was 882,000.

Data also showed that construction orders received by big 50 contractors declined 1.2 percent on year in November, in contrast to an increase of 6.4 percent in October.

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MNI POLICY: BOJ Minutes: Larger Risks; Longer Easing Needed

TOKYO (MNI) - Bank of Japan board members are concerned at the potential impact on domestic prices if downside risks to the global economy materialize, according to the minutes of the central bank's October 30-31 policy-setting meeting.

The minutes, released today, showed that the BOJ left policy setting unchanged because of continued solid domestic demand, which was confirmed through the September Tankan and its quarterly branch managers' meeting.

Board members shared the view, however, of the potential impact of global downside risks.

"Regarding the outlook for prices, risks to prices were skewed to the downside, mainly due to the downside risks to economic activity and uncertainties over developments in medium to long term inflation expectations," the minutes said.

The BOJ's decision to leave policy unchanged saw the bank reject the opportunity to buy some insurance and take pre-emptive policy action.

But the BOJ did tweak its forward guidance, indicating that it will tolerate policy rates moving below the current levels.

"As for the policy rates, the BOJ expects short- and long-term interest rates to remain at their present or lower levels as long as it is necessary to pay close attention to the possibility that the momentum toward achieving the price stability target will be lost," the BOJ said.

The previous forward guidance was that the BOJ will maintain the current easing policy "at least around spring 2020."

Other key points from the minutes:

--"The downside risks concerning overseas economies in particular seemed to be increasing, and if these risks materialized, there was a possibility that prices also would be affected to some extent."

--"One member expressed the view that, given that the sentiment of firms, mainly in the manufacturing sector, and of households had become cautious, reflecting a heightened of risks regarding economic activity both at home and abroad as well as of policy uncertainties, there was some possibility that the momentum toward achieving the price stability target would be lost."

--One member said, "the inflation momentum was maintained in the sense that the economy would not fall into deflation but the momentum toward achieving the price stability target was not maintained."

--A different member said, "taking into account the current situation in which downside risks to economic activity and prices were significant, the BOJ should continue to examine whether additional monetary easing would be necessary."

--Many members shared the view, "The BOJ needed to maintain a policy stance that was titled toward monetary accommodation for a fairly long period of time." They agreed to revise the forward guidance.

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