By Leika Kihara
TOKYO (Reuters) - Bank of Japan policymakers debated in September the potential of making further tweaks to their massive stimulus programme with one seeing room to make monetary policy more flexible, a summary of opinions at this month's rate review showed on Friday.
Another BOJ policymaker called on the need to deepen debate within the nine-member board on the time frame for maintaining the central bank's ultra-loose policy, the summary showed.
The views highlight the dilemma the BOJ faces as stubbornly soft inflation forces it to maintain its radical stimulus, even as the bank's huge buying dries up bond market liquidity and near-zero rates strain financial institutions' profits.
"There is room for the BOJ to consider making its monetary policy more flexible in the future" to revive bond market trading, on condition the economy keeps recovering, one board member was quoted as saying at the Sep. 18-19 rate review.
Another board member cast doubt on whether maintaining the BOJ's current policy, which guides short-term rates at minus 0.1 percent and long-term rates around zero percent, was effective as the positive impact of monetary easing diminishes over time.
"Since there is a limit to continuing with large-scale monetary easing due to its side effects, the time frame for monetary policy should be discussed more among the board," the second policymaker said.
The BOJ kept policy steady at the September meeting, after taking steps in July to make its monetary framework sustainable such as allowing bond yields to move more flexibly around its zero percent target.
The summary of opinions does not reveal the identity of the policymaker who made the comments.
(Reporting by Leika Kihara; Editing by Chang-Ran Kim & Shri Navaratnam)
