Bank of Japan pumps record $40 bn into market

October 9th, 2008 - 1:48 pm ICT by IANS  

Lehman BrothersTokyo, Oct 9 (DPA) The Bank of Japan injected a record 4 trillion yen ($39.8 billion) into the money markets Thursday amid escalating concerns over the global financial crisis.The nation’s central bank carried out the emergency measure for the 17th consecutive business day to free up credit and stabilize the markets.

Prime Minister Taro Aso called for new measures to be implemented and said he instructed the ruling coalition of his Liberal Democratic Party (LDP) and the New Komeito party to draw up additional pump-priming measures.

New measures “are necessary because the outlook for the global financial situation and its impact on the real economy are extremely uncertain,” Aso said.

Aso’s proposal was to be a “super-emergency” economic package, said Kosuke Hori, LDP policy research council chairman.

The government was expected to propose the package within a week or two, Japanese media reports said.

Japan’s ruling parties crafted an 11.7-trillion-yen emergency policy package at the end of August to ease the impact of soaring energy and food prices on households and businesses.

The situation worsened as the US financial crisis sparked by losses linked to subprime mortgages led last month to the collapse of Lehman Brothers Holdings Inc, the acquisition of its fellow investment bank Merrill Lynch and Co, and the US government bailout of insurer American International Group Inc.

The crisis rippled through the global financial industry, sent stocks slumping around the world and caused credit markets to freeze up.

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