MNI BRIEF: BOJ Suzuki: Lending Facility Extension Needed

The Bank of Japan will need to extend its current lending facilities beyond the March 31 expiry date as businesses may face financing problems in coming months, board member Hitoshi Suzuki said Thursday. "There are second wave and third waves of infection. With regard to corporate financing, there will be second wave (of corporate financing) and third wave (of corporate financing), so extending the facility is needed," Suzuki told reporters in Fukushima City via an online conference.

In other comments, he said it is desirable for super long bond yields to rise further as higher yields aid life insurance firms and pension funds. Suzuki noted the excessive drop in those bond yields are unfavorable for investment firms seeking to meet longer-term liabilities.

He pointed that super long-term bond yield is roughly 30 bps lower, compared with the level when yield curve control was introduced. Earlier in the day, Suzuki said, "It is desirable for the yield curve for super-long-term JGBs to become steeper at a moderate pace with the BOJ keeping 10-year JGB yields at around zero percent, in that financial institutions can improve profits on their investment and the BOJ can achieve financial system stability while monetary easing is prolonged."