UPDATE 1-Japan will act to stem excessive rises in yen -PM Abe

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LONDON, May 5 (Reuters) - Japanese Prime Minister Shinzo Abe
on Thursday expressed Tokyo's readiness to take "appropriate
action" in the currency market to prevent any excessive or
speculative rises in the yen.
Abe also said that a summit of the Group of Seven to be held
in western Japan later this month would discuss the need to
coordinate policy action, particularly through flexible fiscal
stimulus, to revive global growth.
"We've seen some rapid and speculative moves in currency
markets recently ... We will watch currency moves carefully and
take action as needed," Abe told a news conference in London,
his latest stopover in a tour of European capitals.
Asked whether currency issues would be discussed at the G7
summit, Abe said: "We expect the issue to be discussed as
needed."
On whether Tokyo is ready to intervene in the currency
market, Abe said excessive volatility in the currency market was
"undesirable" for Japan's trade-reliant companies.
He also said Japan never intended to weaken the yen in a
permanent manner, dismissing criticism from abroad that it was
using ultra-easy monetary policy to depreciate the yen to give
its exports a competitive trade advantage.
The yen surged to an 18-month high against the dollar after
the Bank of Japan held off from expanding monetary stimulus last
week, threatening to derail a fragile recovery for the world's
third-largest economy, which is heavily reliant on exports.
Abe is visiting several European capitals ahead of the May
26-27 G7 summit he will host in Ise, Shima, western Japan, in an
attempt to convince leaders of the need to take coordinated
fiscal and structural policies to spur stagnant global growth.
But Germany, a staunch opponent of using fiscal stimulus to
boost short-term growth, gave Abe only lukewarm support.
"I was able to agree with (European) leaders on the need to
use monetary policy, flexible fiscal policy and structural
reforms in a balanced manner in accordance with each country's
needs," Abe said.
"I hope that the G7 leaders come up with a clear message" on
ways to boost global growth at the summit, he added.
The G7 groups the United States, Japan, Germany, Britain,
France, Italy and Canada.