Tanigaki urges BOJ to keep system flush with ample liquidity.
Finance Minister Sadakazu Tanigaki urged the central bank Thursday to keep injecting the financial system with ample liquidity as a means of quelling deflation.
Tanigaki declined comment on speculation that the central bank may lower its liquidity target, following a series of failures to draw sufficient sell offers from financial institutions for its fund injections.
Such operations involve buying securities from the institutions in question in order to inject liquidity into the financial system. They are aimed at maintaining a target between 30 trillion yen and 35 trillion yen.
"It's an issue to be decided by the BOJ at its Policy Board meetings," Tanigaki told reporters when asked whether the BOJ could consider lowering the target in line, as was suggested Wednesday by BOJ Policy Board member Miyako Suda.
"Japan has yet to overcome deflation. The BOJ has shown firm determination to beat deflation, so we expect it to hold discussions in the same line," Tanigaki said, stressing that the government and the central bank have worked together to fight deflation.
The Japan Times: Feb. 11, 2005
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