/www.bloomberg.com/ By Daisuke Takato
Tokyo, Nov. 26 (Bloomberg) -- Haruhiko Kuroda, Japan's vice minister of finance for international affairs, says the government is ready to take ``appropriate measures'' to stem the yen's rise, which he said had deepened a four-year slide in prices.
``There is a trend toward an extreme strengthening of the yen, and it is having a negative effect on deflation,'' Kuroda said at a conference in Tokyo. ``The recent yen (performance) doesn't reflect the fundamentals'' of the world's second-largest economy, he said.
The yen has strengthened 7.9 percent this year and was trading at 122.03 to the dollar as of 1:09 p.m. Tokyo time from 122.12 in late New York trading.
Kuroda, speaking at the sixth Paris Europlace Financial Forum, said the Bank of Japan should pump more money into the economy to fight falling prices.
``Further easing of monetary policy and stability in the foreign-exchange market would be important to avoid a spiral'' of falling prices, Kuroda said. ``Japan's economy needs to escape deflation and strengthen.''
The Bank of Japan has injected trillions of yen into the economy to stem the price slide and stoke Japan's recovery from its third recession in a decade. The central bank has pledged to keep interest rates close to zero until nationwide core consumer prices start rising from year-earlier levels.
Those prices, which exclude fresh foods, have not risen since April 1998.