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BOJ pumps $16 billion to mitigate corona crisis

BOJ pumps $16 billion to mitigate corona crisis

The Bank of Japan announced on Tuesday that it pumped 1.7 trillion yen ($15.8 billion) into the economy under a lending plan aimed at boosting loans to companies hit hard by the spillover of the Coronavirus pandemic.

Bank of Japan data showed that the amount offered to financial institutions at an auction on Tuesday was twice that of the previous auction held on May 14, indicating that the program direct funds to companies suffering from the virus.

The three-month loan will be delivered to financial institutions on Wednesday. The data showed that the total balance of the funds pumped under the program was 14.4 trillion yen.

The Japanese central bank created the scheme in March as part of steps to ease corporate financing pressures, under which it provides interest-free loans to financial institutions in order to use these funds to boost lending to companies affected by the pandemic.

The central bank also expanded the plan announced in April by accepting a broader set of guarantees and pledging to pay 0.1% interest to financial institutions that take advantage of the loans.

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