Bank of Japan to pump more cash to counter deflation
December 1st, 2009 - 4:54 pm ICT by IANS ( Leave a comment )Tokyo, Dec 1 (DPA) The Bank of Japan said it would inject more cash into the financial system after an emergency meeting the bank called Tuesday to help the government counter deflation.
The Bank of Japan (BOJ) is to lend 10 trillion yen ($115 billion) to the financial institutions for three months at a fixed interest rate of 0.1 percent as part of its efforts to further ease monetary conditions.
With the policy, the BOJ aims to “encourage a further decline in longer-term interest rates”. The bank held its benchmark interest rate steady at 0.1 percent.
The meeting was held as the government stepped up calls on the BOJ to do more to help support the economy amid concerns over deflation and the yen’s sharp rise.
Finance Minister Hirohisa Fujii also welcomed the Bank of Japan’s latest monetary easing measures, saying the central bank has taken “appropriate action”.
“It is important that (the BOJ) continues to act expeditiously,” Fujii told reporters at the Prime Minister’s Office shortly after the central bank’s decision.
Prime Minister Yukio Hatoyama and BOJ Governor Masaaki Shirakawa are scheduled to hold talks Wednesday.
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