The Bank of Japan will discuss taking further steps to ease corporate funding strains at this month's rate review to pump more money to small firms grappling with slumping sales due to the coronavirus outbreak, sources familiar with its thinking said.
While discussions are still in initial stages, possible options on the table include further increases in purchases of corporate bonds and commercial paper (CP), and an expansion in the range of assets the central bank accepts as collateral in offering financial institutions loans, they said.
"The focus for the BOJ is still crisis response, not what measures it can take to reflate the economy," one of the sources said on condition of anonymity due to the sensitivity of the matter.
The BOJ next meets for a rate review on April 27-28.
The central bank eased monetary policy last month by pledging to increase buying of risky assets, including corporate bonds and CP, and create a new loan programme to assist funding of small firms hit by the health crisis.