By Mariko Katsumura and Satoshi Sugiyama
TOKYO (Reuters) - Japan's veteran lawmaker and fiscal dove Sanae Takaichi said on Thursday she would run in the ruling party's leadership ballot on October 4 to replace outgoing Prime Minister Shigeru Ishiba.
Takaichi, who hopes to become Japan's first female prime minister, is seen as one of the frontrunners, along with Agriculture, Forestry and Fisheries Minister Shinjiro Koizumi.
Takaichi said she would hold a press conference on Friday to explain her policies. She has opposed the Bank of Japan's interest rate hikes and has called for increased spending to reflate the fragile economy.
Prime Minister Ishiba announced his resignation this month to take responsibility for a series of bruising election losses, after being in office for less than a year.
The other candidates are Chief Cabinet Secretary Yoshimasa Hayashi, former foreign minister Toshimitsu Motegi and former economic security minister Takayuki Kobayashi.
Hayashi said on Thursday that he would continue some of the policies pursued by the Ishiba administration, including efforts to broaden wage hikes among smaller companies so households can weather the pain from rising living costs.
"I'd like to take steps so Japan sustainably achieves real wage growth around 1%," Hayashi told a news conference to announce his policies.
However, he cautioned against cutting Japan's consumption tax rate, saying the levy was a key source of revenue to fund social welfare costs for the country's rapidly ageing population.
Hayashi distanced himself from "Abenomics"-style fiscal and monetary stimulus pursued by the late premier Shinzo Abe to pull Japan out of deflation.
"Abenomics was an effective policy at the time," said Hayashi, adding the economy has emerged from the severe downturn that required such stimulus measures.
"The BOJ has shifted policy and we're now seeing interest rates rise. The economy has moved to a new phase," he added.
Another candidate, Motegi, told a separate news conference that he would negotiate with the United States for a further cut in tariffs if circumstances permit.
Koizumi was the frontrunner at 23.8% in a poll by Japan's Jiji news agency on who would be best suited to be prime minister, followed by 21.0% for Takaichi. Hayashi and Motegi both came in third at 5.9%, according to the poll released on Thursday.
(Reporting by Mariko Katsumura and Satoshi Sugiyama; additional reporting by Leika Kihara and Makiko Yamazaki; Editing by Chang-Ran Kim and Michael Perry)
