The Bank of Japan will make "flexible" policy decisions as the economy's longest postwar expansion loses steam amid a U.S. slowdown and the yen's 13 percent surge against the dollar this year, BOJ Deputy Gov. Kiyohiko Nishimura said Thursday.

"Currently, the economic outlook is highly uncertain," Nishimura told an Upper House committee. "Without having any preconceptions, we will make a flexible policy judgment by examining our forecasts and the risks."

Nishimura said the BOJ should maintain its basic stance of gradually raising interest rates as long as policymakers are confident the economy will extend its expansion and prices remain stable.