The Bank of Japan decided Friday to scale back its COVID-19 funding support as financing conditions have been improving among large firms, while leaving its ultraloose monetary policy unchanged amid uncertainty over the omicron variant of the coronavirus.
After a two-day policy-setting meeting, the BOJ said it will reduce its buying of commercial paper and corporate bonds issued by large firms but retain until September a program that was due to end in March to support small and midsize firms facing more difficult funding conditions.
The Japanese central bank said, as widely expected, that it will continue to set short-term interest rates at minus 0.1% while guiding 10-year Japanese government bond yields around zero percent.