BOJ to Double Liquidity Supply under New Operation

Tokyo, March 17 (Jiji Press)--The Bank of Japan decided to double
the amount of liquidity supplied under its new money market operation to 20
trillion yen at its two-day monetary policy meeting that ended Wednesday.

Among seven Policy Board members, Miyako Suda and Tadao Noda
opposed boosting the amount under the new operation introduced in December
2009, according to a statement issued after the meeting.
Under the new operation, the BOJ now provides a total of 10
trillion yen in three-month funds to the banking system at a fixed interest
rate of 0.1 pct, a move aimed at "encouraging a decline in longer-term
interest rates."
The BOJ will provide three-month funds twice a week at a pace of
some 800 billion yen each, with the overall amount surging from 10 trillion
yen to 20 trillion yen, the central bank said in the statement.
The expansion comes as "the amount of outstanding of funds provided
by special funds-supplying operations to facilitate corporate financing will
gradually decline from April 2010," the BOJ said.

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