Politics & Policy

Japanese Central Bank Performs Another Cash Injection

Japan’s central bank has now injected a total of 8 trillion yen, or $282 billion into the financial system.  However, this has not prevented the Nikkei average from sliding significantly:

TOKYO (AP) — Japan’s central bank pumped billions more into the financial system Tuesday to quell fears that the country’s banks could be overwhelmed by the impact of the massive earthquake and tsunami. Stocks slumped for a second day as a nuclear crisis escalated.

Two cash injections totaling 8 trillion yen ($98 billion) came a day after the Bank of Japan fed a record 15 trillion yen ($184 billion) into money markets and eased monetary policy to support the economy in the aftermath of Friday’s 9.0 magnitude quake that has killed thousands.

The injections have helped stabilize currency markets. But stock markets dived for a second day as investors unloaded assets amid escalating worries of a nuclear crisis.

The benchmark Nikkei 225 stock average slid as much as 14 percent after Prime Minister Naoto Kan warned residents near a damaged nuclear power plant in tsunami-ravaged northeastern Japan to stay inside or risk getting radiation sickness. It closed Tuesday down 10.6 percent at 8,605.15.

Full story here.

Nat Brown is a former deputy web editor of Foreign Affairs and a former deputy managing editor of National Review Online.

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