Policy shift will be 'headache' says Watanabe

Coping with higher interest rates will pose a "headache" for the Japanese economy, and the central bank is considering how to limit the impact on bonds, according to Hiroshi Watanabe, Japan's vice finance minister for international affairs, who was speaking in London.

``The overall situation is good but we have two headaches -- deflationary pressure and how to cope with a change in monetary policy,'' Watanabe said at a press conference in London following a seminar with bond investors. ``A has

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