Summary Other options include cutting interest rates deeper into negative territory
TOKYO (AFP) - Tokyo shares opened lower Wednesday with investors focused on a Bank of Japan policy meeting as weak trade data reignited concerns about the world s number three economy.
Japan s central bank, which wraps up its two-day policy meeting later in the day, is to issue an unprecedented report card on its monetary policy, with some expecting the bank to launch more stimulus measures to prop up lacklustre growth.
The meeting comes as the US Federal Reserve also finishes a meeting later in the day, but few expect the central bank to move on interest rates until later in the year at the earliest.
In early trading, Tokyo s benchmark Nikkei 225 index slipped 0.22 percent, or 35.86 points, to 16,456.29, while the Topix index of all first-section issues edged up 0.04 percent, or 0.49 points, at 1,317.46.
Sentiment was dented by official data that showed Japan recorded a surprise trade deficit in August as exports tumbled, adding to concerns about the state of its economy.
Bank watchers think that BoJ policymakers may try to kickstart the economy by expanding an already massive 80 trillion yen ($785 billion) annual asset-buying plan. But there are concerns that the bank is running out of government bonds that it can buy under the programme.
Other options include cutting interest rates deeper into negative territory.
Negative rates are meant to encourage lending to people and businesses by effectively charging banks to keep excess reserves in the BoJ s vaults. But commercial lenders have complained they are eating into their financial results.
Markets will also keep a close eye on details of the bank s review of its policies and whether it makes any chances to its inflation target.
"A comprehensive review of its monetary easing programme by the BOJ and any actions that might come with it is something the market has never experienced," Chihiro Ohta, a senior strategist with SMBC Nikko Securities, told Bloomberg News.
"It s likely to get volatile after we get the announcement this afternoon," he added.
In share trading, Takata dropped 4.54 percent to 357 yen after reports that potential buyers were considering bankruptcy proceedings for the embattled airbag supplier, which has been hit by the global auto industry s biggest-ever safety recall.
A defect in Takata s airbags can cause them to deploy with excessive force, hurtling shrapnel at a vehicle s occupants. The problem has been linked to at least 15 deaths and scores of injuries globally.
