The Bank of Japan poured a record amount of cash into the financial system and doubled the size of their asset-purchase plan to shield the economy from the effects of the nation’s strongest earthquake on record.
The central bank pumped 15 trillion yen ($183 billion) into money markets to assure financial stability amid a plunge in stocks and surge in credit risk. Governor Masaaki Shirakawa and his board also increased the program that buys assets from government bonds to exchange-traded funds to 10 trillion yen.
Policy makers said they were concerned corporate and household sentiment will worsen, with production set to decline in the aftermath of the temblor and an ensuing tsunami. The March 11 catastrophe killed an estimated number of more than 10,000 people, shut down factories, prompted rolling power cuts and sparked the risk of a meltdown at a nuclear power plant.