The effects of Bank of Japan’s liquidity provision on the year-end premium

Yasuo Hirose, Shinsuke Ohyama and Ken Taniguchi

Journal of the Japanese and International Economies, 2012, vol. 26, issue 1, 179-185

Abstract: The premium on interbank money market rates arises over year-end periods as a result of the Japanese business practice of periodic settlement. This paper examines to what extent the Bank of Japan’s liquidity provision reduced the year-end premium in Japan. We find that the funds-supplying operations over the year-end and the fiscal year-end of 2008 had the largest effects during the period from 2006 to 2008, reflecting the fact that the Bank of Japan significantly expanded liquidity provision in response to the decrease in market liquidity under the financial turmoil.

Keywords: Money market operation; Year-end; Monetary policy (search for similar items in EconPapers)
JEL-codes: E50 E52 E58 G10 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jjieco:v:26:y:2012:i:1:p:179-185

DOI: 10.1016/j.jjie.2011.09.007

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