UPDATE 1-Japan govt applies fresh pressure on telecom carriers to cut charges

* Top govt spokesman says room for carriers to cut fees further

* Calls on carriers to ‘actively’ look for ways to cut charges

* PM Suga has made carrier fee cuts a policy priority

* Lower charges to push inflation further away from BOJ’s target (Adds quotes from Kato, context on economic impact)

TOKYO, Oct 14 (Reuters) - Japan’s government is hoping mobile phone firms will “actively” consider ways to cut carrier charges, its top spokesman said, stepping up pressure on the sector to meet Prime Minister Yoshihide Suga’s aim of boosting households’ purchasing power.

Cutting carrier fees has been among Suga’s policy priorities since becoming prime minister last month, as he looks to clip the wings of a highly-protected industry and encourage more competition.

“There’s room to cut carrier fees further,” Chief Cabinet Sectretary Katsunobu Kato told a regular news conference on Wednesday, adding he hopes carriers will “actively come up with ways to do so.”

The remarks came after the Nikkei newspaper reported that SoftBank Corp is considering a new mobile plan offering lower cellphone charges.

Analysts say other carriers may follow suit.

While lower fees would benefit consumers, it might prove to be a double-edged sword for the Bank of Japan’s 2% inflation target, at least until the longer-term boost to consumption begins to offset the downward pressure from the lower charges.

“Lower cellphone fees would be something similar to tax breaks for households,” said Yoshiki Shinke, chief economist at Dai-ichi Life Research Institute.

“They may also weigh on prices. But the BOJ has long detached its policy moves from inflation, so weak prices alone won’t force it to ease monetary policy further,” he said.

The BOJ eased policy twice this year to cushion the economic blow from the coronavirus pandemic. It now focuses on supporting the economy rather than hitting its 2% inflation target, which remains elusive despite years of heavy money printing.

Japan’s core consumer prices fell 0.4% in August from a year earlier, the fastest pace in almost four years, as the pandemic cools demand in the world’s third-largest economy. (Reporting by Leika Kihara and Daniel Leussink; Editing by Chris Gallagher & Shri Navaratnam)