Japan ruling party panel urges drastic monetary easing

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TOKYO, April 13 (Reuters) - A group of lawmakers from the ruling Democratic Party of Japan called on Tuesday for the government and the Bank of Japan to use all monetary and fiscal policy tools available to erase deflation.

The lawmakers urged the central bank to carry out drastic monetary easing until deflation is completely beaten.

They said the government needs to set an annual consumer inflation target of over 2 percent, and that the BOJ should try to achieve the target through its own policy measures.

The draft proposal also said efforts should be made to maintain "appropriate" currency levels of around 120 yen per dollar JPY=.

The proposals were made by more than 100 DPJ lawmakers, who launched the study group last month to mull measures to beat deflation, a move that is likely to add pressure on the BOJ to do more to end price falls.

They will submit the proposals to party executives for possible inclusion in the DPJ's campaign platform for upper house elections expected in July. (Reporting by Tetsushi Kajimoto)