Japan's monetary base hits new record high in February

Japan's monetary base jumped 55.7 percent in February from a year earlier to JPY 201.32 trillion (USD 1.98 trillion), marking an all-time high for the 12th straight month, the central bank said Tuesday. The monetary base, which comprises money supplied to the markets by the Bank of Japan (BOJ), including cash in circulation and commercial banks' deposits held at the BOJ's current accounts, also grew for the 22nd month in a row. An expansion in the monetary base has inflationary effect. Last April, the BOJ launched drastic measures to double the monetary base in two years, chiefly through the purchases of government bonds from financial institutions and money market operations, to overcome the country's deflation that has lasted for nearly 15 years and achieve the 2 percent inflation target in fiscal 2015. The central bank aims to increase the monetary base at an annual pace of about JPY 60-70 trillion (USD 590-690 billion). The BOJ board decided in February that the bank will maintain its massive monetary easing program and continue to conduct money market operations.