The Bank of Japan (BoJ) left its short-term interest rate unchanged at -0.1% during an emergency meeting on May 22nd. Policymakers also maintained to buy ETFs and J-REITs so that their amounts outstanding will rise at an annual pace of JPY 12 trillion and about JPY 180 billion, respectively, but launched a new lending program worth JPY 30 trillion ($279 billion) to support small businesses struggling with the fallout from the COVID-19 pandemic.

Under the new program, which will remain in place through the end of March 2021, the BOJ will provide 0% loans to commercial banks that extend interest-free lending to clients under the government’s virus relief package. These banks will be given 0.1% interest on their current account deposits at the BOJ in proportion to the amounts of interest-free loans they receive from the central bank.