TOKYO - The Japanese central bank said Tuesday it welcomed joint efforts by five central banks to inject liquidity into the financial system amid lingering market turmoils and economic worries.
The US Federal Reserve announced Tuesday moves to pump more liquidity into the global financial system, easing terms for direct loans to banks and increasing swap arrangements with other central banks.
"The Bank of Japan welcomes these measures and hopes that they will contribute to maintaining the functioning of the international financial markets," the bank said in a statement.
The US Fed said it was pumping 200 billion dollars into a new Term Securities Lending Facility, with term of 28 days instead of overnight under an existing program.
This allows banks to obtain Treasury securities by pledging collateral such as mortgage-backed securities and other debt. Auctions will be held on a weekly basis, beginning on March 27.
The move was coordinated with the European Central Bank, the Swiss National Bank, the Bank of Canada and Bank of England.
Central banks from the Group of Ten major countries have consulted regularly on liquidity pressures in funding markets, the Bank of Japan said.
"Pressures in some of these markets have recently increased again. We all continue to work together and will take appropriate steps to address those liquidity pressures," the Japanese bank said.
Japan's money markets "continue to function relatively well thus far," the bank said.
The Bank of Japan "will continue to conduct money market operations appropriately as to maintain market stability, including supplying sufficient fund over the fiscal year-end," it said.
hih/msl
03/11/2008 13:48 GMT