Japan’s central bank kept its benchmark interest rate steady yesterday but introduced new steps to spur lending and ease the strains of an increasingly painful recession.
The Bank of Japan’s (BOJ) eight-member policy board voted unanimously to leave the key overnight call rate target unchanged at 0.1 percent, as widely expected.
With interest rates close to zero, the central bank has little room to tweak regular monetary policy and has instead focused on measures to boost corporate financing, which has shriveled amid the global credit crisis.
The central bank already buys commercial paper and corporate bonds to help shore up banks’ balance sheets, but it acknowledged that “financial conditions have remained tight on the whole.”
In its latest move, the BOJ expanded the range of collateral it accepts in an effort to funnel more funds to commercial banks and subsequently, to companies seeking loans. The bank said it now welcomes “loans on deeds to municipal governments as eligible collateral.”
Japan’s interest rates are among the lowest of major economies.
The US Federal Reserve’s targeted range hovers between zero and 0.25 percent, while the European Central Bank last week trimmed its benchmark rate to 1.25 percent.
The BOJ said it expected the Japanese economy to start recovering toward the end of this fiscal year, “with price declines abating as global financial markets regain stability and overseas economies move out of their deceleration phase.”
Separately, the Bank of Japan, the European Central Bank, the Bank of England and the Swiss National Bank said on Monday they would enter into swap arrangements to provide foreign exchange liquidity to the Federal Reserve if needed.
Under currency swap arrangements the Fed provides dollars in exchange for reserves of the other nations’ currencies. The Fed has entered into or expanded 14 such agreements since the credit crisis intensified last year, including with the four central banks in Monday’s announcement.
The Taipei MRT is open all night tonight following New Year’s Eve festivities, and is offering free rides from nearby Green Line stations. Taipei’s 2025 New Year’s Eve celebrations kick off at Taipei City Hall Square tonight, with performances from the boy band Energy, the South Korean girl group Apink, and singers Gigi Leung (梁詠琪) and Faith Yang (楊乃文). Taipei 101’s annual New Year’s firework display follows at midnight, themed around Taiwan’s Premier12 baseball championship. Estimates say there will be about 200,000 people in attendance, which is more than usual as this year’s celebrations overlap with A-mei’s (張惠妹) concert at Taipei Dome. There are
NEW YEAR’S ADDRESS: ‘No matter what threats and challenges Taiwan faces, democracy is the only path,’ William Lai said, urging progress ‘without looking back’ President William Lai (賴清德) yesterday urged parties across the political divide to democratically resolve conflicts that have plagued domestic politics within Taiwan’s constitutional system. In his first New Year’s Day address since becoming president on May 20 last year, Lai touched on several issues, including economic and security challenges, but a key emphasis was on the partisan wrangling that has characterized his first seven months in office. Taiwan has transformed from authoritarianism into today’s democracy and that democracy is the future, Lai said. “No matter what threats and challenges Taiwan faces, democracy is the only path for Taiwan,” he said. “The only choice
CORRUPTION: Twelve other people were convicted on charges related to giving illegal benefits, forgery and money laundering, with sentences ranging from one to five years The Yilan District Court yesterday found Yilan County Commissioner Lin Zi-miao (林姿妙) guilty of corruption, sentencing her to 12 years and six months in prison. The Yilan District Prosecutors’ Office in 2022 indicted 10 government officials and five private individuals, including Lin, her daughter and a landowner. Lin was accused of giving illegal favors estimated to be worth NT$2.4 million (US$73,213) in exchange for using a property to conduct activities linked to the 2020 Chinese Nationalist Party (KMT) presidential and legislative election campaigns. Those favors included exempting some property and construction firms from land taxes and building code contraventions that would have required
TECH CORRIDOR: Technology centers and science parks in the south would be linked, bolstering the AI, semiconductor, biotech, drone, space and smart agriculture industries The Executive Yuan yesterday approved a “Southern Silicon Valley” project to promote the development of an artificial intelligence (AI) and semiconductor industry in Chiayi County, Tainan, Pingtung County and Kaohsiung. The plan would build an integrated “S-shaped semiconductor industry corridor” that links technology centers and science parks in the south, Executive Yuan spokesperson Michelle Lee (李慧芝) said yesterday after a Cabinet meeting. The project would bolster the AI, semiconductor, biotech, drone, space and smart agriculture industries, she said. The proposed tech corridor would be supported by government efforts to furnish computing power, workforce, supply chains and policy measures that encourage application and integration
RSS