Japan doubles bank package

Date: Wednesday 17 Mar 2010

Japan has boosted its stimulus efforts in an attempt to invigorate its stagnating economy after growth figures for the last quarter of 2009 were revised downwards.

The Bank of Japan has doubled its bank finance programme to $200bn while interest rates were held at a nominal 0.1%.

Japan introduced the scheme to lend money to the banks at the end of 2009 amid fears the country was sliding back into deflation.

A revision of the latest GDP data trimmed growth down to 0.9% from 1.1% between October and December of last year has added to the pressure on the Bank of Japan to boost the availability of money to try to encourage lending and spending.

Japan has never recovered fully from the collapse of property and share prices at the end of the eighties and has been dogged by deflation ever since.

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