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Bank of Japan officials began a two-day Policy Board meeting Monday amid growing pressure for the central bank to take additional credit-easing measures.

The first day of the meeting saw the benchmark Nikkei average plunge to a new postbubble low of 11,477.56. The fall offered grim material for BOJ policymakers to ponder, along with rising unemployment, slowing production and continued uncertainty in the global high-tech and telecommunications sectors.

With foreign and domestic pundits warning that the nation is headed for recession, attention is turning to the central bank as the economy’s sole source of salvation.

Costly fiscal policy initiatives are unlikely, with Prime Minister Junichiro Koizumi having repeatedly voiced commitment toward reining in the government debt.

Meanwhile, any move to depreciate the yen in order to help Japanese exporters amid a global slowdown is bound to provoke fierce criticism abroad, especially from Japan’s Asian neighbors.

Heizo Takenaka, minister of economic and fiscal policy, said last week that he hopes the BOJ will implement further credit-easing measures.

Criticism of the central bank is meanwhile mounting within the Liberal Democratic Party.

“The BOJ does not seem to think that fighting deflation is as important a part of its job as fighting inflation,” Fumio Kyuma, acting chairman of the LDP’s Policy Affairs Council, told reporters last week.

A group of other LDP members led by Kozo Yamamoto has started work on a bill to compel the BOJ to issue a public commitment to keep prices at a given level.

“We’re tired of excuses,” Yamamoto said during the group’s first meeting Thursday.

“If (BOJ officials) can’t keep prices at a certain level, then I say they are too inept to keep their jobs.”

The measures open to the central bank are limited.

Since March, the BOJ has pursued quantitative easing measures, pushing overnight interest rates close to zero by ensuring that banks hold large reserves of surplus funds.

The BOJ decided to keep these measures in place until the consumer price index rises to zero percent.

The central bank has stated repeatedly that boosting reserves of surplus funds will do little to increase liquidity. In response to calls for inflation-targeting, BOJ officials have said that targets mean very little if no one believes they are reachable in the near future.

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