Bank of Japan to Hold Emergency Meeting This Week

Daily Forex Fundamentals | Written by DailyFX | Dec 01 08 03:06 GMT |

The Bank of Japan will hold an emergency meeting this week to discuss plans on creating a lending facility for domestic firms struggling to get financing in current market conditions. The plan would allow banks to use corporate bonds with lower credit rations as collateral to gain access to BOJ funds. The news was broken by NHK, Japan's public broadcaster. Japan sank in recession having posted negative GDP results in the second and third quarters and the road back to prosperity is an uncertain one. We have noted for some time now that policymakers are quickly running out of alternatives to offer meaningful stimulus to the economy: monetary measures have little scope with interest rates already within a hair of 0% and fiscal stimulus could be hit-or-miss given the Japanese consumer's infamous proclivity to favor saving over spending. As Japanese leaders veer further from the standard script of policy prescriptions to boost the ailing economy, proposals of a return to currency market intervention to suppress the Yen and boost the export sector (a stand-by crutch for Japanese economic growth) are likely starting to make the rounds among officials. Japan's government became infamous for currency intervention extensively in the 1970s and ‘80s. DailyFX Disclaimer Investment in the currency exchange is highly speculative and should only be done with risk capital. Prices rise and fall and past performance is no assurance of future performance. This website is an information site only. Accordingly we make no warranties or guarantees in respect of the content. The publications herein do not take into account the investment objectives, financial situation or particular needs of any particular person. Investors should obtain individual financial advice based on their own particular circumstances before making an investment decision on the basis of the recommendations in this website. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. All intellectual property rights are the property of Daily FX. Daily FX and its affiliates, will not be held responsible for the reliability or accuracy of the information available on this site. The content herein is provided in good faith and believed to be accurate, however, there are no explicit or implicit warranties of accuracy or timeliness made by Daily FX or its affiliates. The reader agrees not to hold Daily FX or any of its affiliates liable for decisions that are based on information from this website. Daily FX highly recommends that before making a decision, the reader collects several opinions related to the decision and verifies facts from at least several independent sources.