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Bank of Japan extends offer to buy bonds

February 19, 2009

The Bank of Japan said Thursday it would buy up to $10.7 billion in corporate bonds and other assets to help companies weather the financial downturn.

The banks said it would buy corporate bonds rated A and higher, the Financial Times reported. It also said it would extend unlimited loans to financial firms, provided they were backed by collateral. In addition, the bank kept its key lending at 0.1 percent.

Economic conditions have deteriorated significantly and are likely to continue deteriorating for the time being, the bank said in a statement.

The Bank of Japan predicted deflation would likely begin by the second quarter.

While a recovery was likely to begin in the second half of the year, uncertainty is high, the bank said.


Source: upi



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